They will walk you through it and explain the in's and out's before setting you free to use it to do deals. 

Explain they aren't paying 4 separate security deposits too,  I don't care about getting 4 checks I just tell them the deposit is for all damages and if one moves out they need to settle the damages among themselves.    

Luckily one of my other neighbors has had to deal with this particular owner so I now have the address and I am going to send him a letter explaining everything.

If they tell you that the tenant said it was OK, politely explain that the tenant does not have the authority under the lease to give that permission.Make sure the utilities are all in your name and that nobody is authorized to turn them on or transfer the name without your permission.My recommendation is that you take action to have the person leave voluntarily or be removed as soon as possible.

I explain that the roof alone is more than the kitchen renovation so they can come in and put their own kitchen in to their own tastes.  

Here is a good page from the IRS that explains the tax implications:https://www.irs.gov/individuals/international-taxp...Basically, you would likely be filing a Form 1040NR.

The lender I talked to tried explaining to me that in order to use it again or “access the second tier of the entitlement” I would have to take out a loan with a minimum of around $145k.

Did your agent explain that to you?  

Let me explain, if he is a RE Investor, he may need someone who can run some errands such as documents, purchasing things in a hardware store etc.

This makes the calculations different than just the straight percentage of your marginal rate (like on Schedule A).Your tax accountant can explain this in detail.