Thank you @Paulette Midgette Great Explanation.

Therefore I had my real estate agent reach out to the sellers and the explanation is as follows: They had a management company draw up the lease for the second unit and unfortunately they did not list the appliances or the responsibility of the water bill. 

That seems like the most likely explanation.. 

In other words, if transactions were made 50% more than your monthly income, you will need to explain/address the funds via letter of explanation @Carlos Valencia @Albert Bui

A great example of Occam's razor: "of any given set of explanations for an event occurring, the simplest one is most likely the correct one."

:)thanks for the full feedback... i agree that you seem to have a nice arrangement/offer from your potential mentor.after reading your explanation, I can see your point.

This is exactly the type of explanation I was looking for. 

If you guys think he's okay based on 40k,   I'll ask for pay stubs and an explanation  for the judgement and collection balance.    

Please go to https://americansabroad.org/issues/taxation/us-tax...to see explanations on filing a US tax return even if you do not have any US income.  

In fact I have done a lot of them for the investors from Bigger Pockets who live in California.The explanation @Linda Weygant gave is the best, for understanding the tax differences, and some of the formality differences.I think, maybe, youre asking a different question, that I'm asked frequently.