You don't want to pay Principal and interest if you are having to take units out up front to rehab with no income coming in.E. 

The total amount they receive from the preferred return distributions does drop because they are now earning their preferred return on the less principal they have in the deal.

My VA goes over the lease with them, asks if they are sure they want to do this.I've had a couple tenants struggle financially and choose to move out, but no one has had to be evicted or owed me money that I placed.

If I was to buy a property and put down the amount of tax I owe as a down payment, would that decrease my taxable income because it is now in an asset? 

I am running my sample 2022 tax return in order to figure out how much federal I'll owe for the year.

Taking a quick look at Form 4868 seems to support this (though maybe you can avoid the late payment penalty if at least 90% of your total tax had been paid by the regular due date):  https://www.irs.gov/pub/irs-pd...Here are the relevant form instructions that I'm referencing:InterestYou’ll owe interest on any tax not paid by the regular due date ofyour return, even if you qualify for the 2-month extension becauseyou were out of the country.

We even pay principal & interest on the down payment to our one partner!

The problem was that they owed way more than it was worth (owed 60k and figured only worth $25k).

Then my partner got on the phone with him, extracted some pain, and realized he owed the private money lender money, and he didnt pay him off right away .. ( to our knowledge ) was listed at 525K fully gutted inside ( to the studs ), and we got him down to 450K, we told him we would find him a buyer, and MY buyer came in at 455K, everyone and their moms wanted it for the high three's.

That kind of Calculation will open your eyes once you see how the Principal and Interest moves in relationship to a 30 year fixed rate mortgage.