If the domain has authority, clean content, bad link profile, then how would out-going links to my site affect my site?
I have read about somewhere that Google don't know domain authority its only check backlinks keywords. I personaly tested this for one of my website which has more then 25 backlinks with different URL/alt keywords & moving fast in Google. The all website from which I have generated this backlinks are poor quality/spam.
Google does not know DA; DA was created by moz using algorithms in order to guess where google is ranking your site; If you have high DA, then dont you think the site would obviously be ranking in Google? DA has nothing to do with google. other then that, I could not understand your 2nd paragraph.
One bad link won't harm your site but you obviously want to avoid these links and remove them from your link profile if at all possible.
So they are bad links even if they appear to have high authority? I think their bad link profile somewhat gives it away.... my guess is that they bought an expired domain with authority... probably useless, then put some content on it, then sell backlinks... but I still have to wonder, the post indexed very quickly.... If google thinks the site is so bad, why did google even index the article?
You want backlinks that are authoritative AND trusted. If the site has a bad link profile, then it's likely not trusted by Google and could even be penalized.