For example, what happens if you identify a property and then cannot close on it due to inspection issues or other related problems?

Are you saying that for one year after a property owner has lost a home in a tax-deed sale, they can still get it back from the person who bought it at auction if they pay off all fees related to the property?

How does IRMAA (Income-related monthly adjustment amount) affect Medicare when you're liquidating?

This seems to me to be a typical cart before the horse issue.

While $50 may seem steep, it’s relative to the rental’s value.

I haven't found any guidance from the IRS that says that Schedule E can or can't be used for rental income from a property you don't own, but the Schedule E instructions and related guidance all seems to be based on the assumption that you own the property. 

@Kyle JosephThere are plenty of models out there.Many are free or low cost.The real issue is knowing your market - rents, vacancy rate, expenses etc.The magic is NOT in the model but rather the data one enters into the model.Agree with @Chris Seveney

Legal issues in setting up this type of business at your location?

However you likely cannot refinance for a year if you complete a quiet title because most lenders will require title insurance and providers typically won't issue it until you own the property for 1 year even if you complete a quiet title because the tax sale process is so messy and prone to issues.

Investigate rental revenue prospects, market trends, vacancy rates, and regulatory issues in possible investment locations second.