Any way Message me if you would like to chat to much info to Luis Maquiera  Multifamily Partners 

My partners and I subdivided the property into two distinct rental units:Unit 1: 2 BR / 1 BAUnit 2: 1 BR / 1 BAGiven this setup, the property is now being used as a multifamily dwelling.

Therefore a partnership return will need to be filed and each partner will get a K-1 reporting their share of income.Each investor will then report that income on their return.Taxes will be calculated based on each partner's tax rate.Best of luck.

As a Real Estate Professional, you can offset active and passive income, but your partner may only offset passive income unless he qualifies as a Real Estate Professional.

We don't allow any "deal-making" in the forums, which includes advertising your services or properties, looking for partners, etc.

However LP's entity  both in Canada and the USA treated the same as flow thru's entities and that may be what he would want to create an LP to partner instead of a LLC.

or partner with a buyer for a flip? 

The primary form of diligence we see on the forums is "what do you think of XYZ sponsor and deal" whereas the common form of diligence in the space by institutional investors, large investment groups, family offices, and sophisticated investors involves following the sponsor for years, underwriting the deals, validating rent comps, background checks on the general partners, and a host of other diligence that materially de-risks the investments.  

My partners & I are flipping in Chattanooga so I hung out there for a couple of days, meeting my contractor and agent for the first time; of course I went by and took at our flip. 

You definitely want a legal agreement that's forecloseable, getting as much front money as possible so that you're not just in a lurch with nothing if/when they default, and you should get better interest terms for "being the bank" AND I would qualify the buyer just the same as if they had to go to a bank, because you want to know who your partner is in this deal.