See the following: https://www.irs.gov/retirement-plans/plan-participant-employee/401k-resource-guide-plan-participants-general-distribution-rules

The following coverts this type of 401k.https://www.biggerpockets.com/blogs/3441/52232-starting-a-real-estate-investment-business-with-a-robs-401khttps://www.irs.gov/retirement-plans/employee-plans-compliance-unit-epcu-completed-projects-project-with-summary-reports-rollovers-as-business-start-ups-robs

Hi John,If you pay a contractor hourly then the IRS may deem them as employees in which case you will need to withhold taxes.

@Dave Foster is correct, I would suggest that the check is made out to the escrow company and not your own name if you have that ability and have them deposit  it in your escrow company so you are sure that the amount paid is actually there and was not written on closed account nor written on a check that a stop payment can be issued so ensuring the check is deposited, not into your account or an account to which you have what could be construed as constructive receipt, is important to ensure that the deposit check is actually a good check and that the Buyer has "skin" in the game!

Leave the lower margin, headache stuff behind gradually    I'm hiring a business coach to help me get over the hurdle of growth so I don't have to run so many calls   I actually enjoy them, but would rather pick and choose when I go vs employees go.    

@Dave Foster thank you for the very thorough response and gives me more insight into how to proceed. 

She was never a manager (In Georgia only licensed PM or Real Estate agents or fulltime employees of owner can manage properties), but only a friend that helped me out.

Hi everyone this is my first question ever .Im a full time employee part time investor but I'm in a dilemma I have 2 rental properties with less than 35k owe in each thru mortgage lender .

Hi everyone this is my first question ever .Im a full time employee part time investor but I'm in a dilemma I have 2 rental properties with less than 35k owe in each thru mortgage lender .

Thanks @Dave Foster,  I was unaware that an audit was possible in that situation.