The benefits of the S-corp are paying FICA on your "wage that must pass the BS test for the type of job" rather than paying self-employment tax on all of your flip or wholesale income.

You would do this for any self-employed applicant.

She is self-employed (her own business) but makes very little money on paper.

People are also brainwashed into thinking that investing via their employer-sponsored 401(k) is the only way to invest and that passive investing in the market is the only way to achieve wealth.  

Now in my pursuit of self employment I am looking at purchasing another.

I hope to learn skills (I will enjoy) that will keep me employed for the next 20 years.  

@Michelle ReynoldsIf your partner is under age 59 1/2 and the 401k is with their current employer, they likely cannot move the funds to a self directed IRA that would be able to invest in real estate.If the funds are from a prior employer, or they are over age 59 1/2, they can move the funds to a vehicle that would allow for real estate and private lending investments.There is a ton of good information here on BP, and with a little reading in the forums, you'll find several providers of self directed plans and get a feel for the services they offer.If your friend has the ability to move funds, they can contact one or more plan providers to learn about their options.  

Based on my reading and understanding, it seems that that Solo401K is a much better option than SDIRA-LLC and one can do it even if I am on W2/full time employed, just by setting up some micro business. 

I am self employed.  

Sometimes you can't get bank financing because you're self-employed, and the bank won't underwrite you.