If they sue you in federal court, I hope you have very, very, very deep pockets.If the threat of a lawsuit is not imminent, then I would get all properties out of your name anyway, and as fast as you can.

If the judgment person moves out of state from where the judgment originated that can also create a host of problems with enforcing.You can try for wage garnishment, bank levy etc. but what others have not mentioned is to do these things your former tenant has to be above certain federal income guidelines.

As creative financing and how to get financing is a popular topics on this forum, I thought I would share.  

This already exists for more popular investments that I have been familiar with in the past.  

In seeking out housing options I decided that I would like to live in the Federal Hill area (which tends to be one of the higher priced neighborhoods). 

I have an understanding of how the federal taxes would work (at least somewhat), I would add the profit from the flip to my current income and then pay the taxes according to the tax bracket I am in(if sold under 1 year-which is the plan). 

Even selling a "loaded rental" at a higher price to investors is a very popular business model.

If you make her an employee, you will have to withhold the employee share of FICA taxes, pay the employer share of FICA taxes, pay SUTA tax (maybe), pay FUTA tax (maybe), and withhold Federal Income Taxes on her pay.  

Rents are rigged at the federal level to go up slowly over time, though.

The seller would not have to pay federal tax if under $250 profit, but we would have to if we actually bought it and flipped it.