Also I want to know is the distribution subject to income tax and that to the to the business or personal level.

When a tax-exempt entity (IRA, 401(k), HSA, non-profit, etc.) engages in a trade or business on a regular or repeated basis it is creating Unrelated Business Taxable Income (UBTI) which is subject to tax. 

They even had seen pictures of the buildings before, knew the locations, etc. but still decided not to fund for their own subjective reasons. 

I came up with a subject to deal, assuming his mortgage and no money down.

I do, however, recommend making sure all expectations and responsibilities are very clearly outlined and who's getting what for their contribution.

By the way, I'm working on closing a rental in North Ridgeville now, I'm trying my hand at a creative subject to on that one

Some fees are subject to changes before closing.

Thank you @Jaysen Medhurst for your feedback, at what point would additional properties require additional protection (obviously a very subjective question).

The seller is open to subject to, but now we have an issue with how are we going to find the rehab?

What was once fairly simple and more focused on the process is now very complex and expensive because of all the new laws even the smallest would be seller financier is now subject to.The issues are even more complex because the financing of manufactured homes has many rules that are different than those that apply to mortgage lenders.