Further, there are minimum habitability standards set by your state's Board of Health and maybe even the local code enforcement office.

And I'm already at a $0 tax liability because of children and other tax deductions. 

Applicant said that they do not have any pets, but they do have a co-worker that comes through town twice a week that will be staying overnight, and they have a dog.My standard terms for a normal pet situation are $25/month per pet, $300 non-refundable pet fee.

From what I understand about deductions these should be done after the property is officially "for rent," right? 

Look for a program that will allow a refinance based on appraisal (not purchase price) prior to the 6 month standard.

Upshot is that I could then deduct health insurance and other business expenses directly against the income (and can offset deals gone bad against income)Has anyone done this and have thoughts on it?  

And what is your standard schedule for rent deposits?

Yes, i'll pay for the attorney but i am done with these manipulating, un-grateful tenants.My insurance deductible is $2500 and the damage is not that great to warrant filing a claim...and tenant insurance doesn't pay for structural damage (they don't even have insurance)...

People want to decree something as fact and regurgitate the standard party line when there's no basis in fact whatsoever. 

Dont forget to factor your rehab when putting together an offer. if you're serious, get a contractor to give you an estimate on the rehab so you can better understand what its going to take to bring this property up to your standards. finding a distressed property and using the 203k is probably your best bet to make these rules work in your favor.