The 300k drop wasn't just a "punishment" because they didn't take your offer the first time, its because the home now needs more work.

People should be rewarded, not punished, for getting a job.  ;-) 

If you poorly run your business, the market will savagely punish you.

The ones who do insist need to be punished with a high turnover rate.

And I can send you a study my CPA gave me, which mentions quite a bit of case law where people tried to claim RE professional status, got audited, got punished badly, protested in court, and lost.

If the government deems him safe enough to be out, then I doubt that someone can punish me for renting to him. 

The time and effort you put into truly learning and preventing it will be 3x better for YOU than trying to punish the tenants, they're sunk cost lost cause—forget em!

While a dealer may skid by a technical violation on one hand, the punishment may be applied under other laws and done so to a much greater extent due to the surrounding facts.  

Don't try and expense it as a business expense if it isn't for your business.People who do these sorts of things make life hard for the rest of us who walk the line.It is a felony and punishable by up to 5 years in prison and a fine including payment of all investigative and legal costs.No I am not going to turn you in.  

Guys like this need to be punished so they don't hurt anyone else.