Operating expenses are routine and necessary costs to keep the property in its ordinary operating condition, and they are typically deductible in the year they are incurred.You also mentioned the benefits of classifying something as an operating expense versus a capital expenditure.

I would start with a written violation and demand they clean up their act or move out.

Investment Info:

Single-family residence wholesale investment.

Purchase price: $100,000

Sale price: $112,000

One more wholesale deal in the books. This one was special because it was completed with a...

I keep good records and have clean books.

While we do run a business that is for profit - you always do not need to be a hard ash and if someone is going to work with you, then extend the offer.So this is what we did, and guess what, she did not trash the place, she moved out and took all her stuff and left the home very clean and spotless.

It just needed cleaned up and redesigned.

Meaning you will not be able to furnish a clean title within the time period.

They also have strict rules for renters about sharing the kitchen, cleaning, etc. with monetary penalties for not complying. 

Also if he is just taking PITI into the equation, he is missing/withholding info about utility costs, stocking/supply costs, cleaning costs, etc. 

A bit of a more advanced exit strategy, but one that can be extremely profitable when implemented correctly.We spent $18k to clean out the place and then we turned around and made $40k after cleaning costs, closing costs, and commissions.