I know his cost basis in the property is likely very very low, so selling would trigger significant capital gains and depreciation recapture. 

Noooo you triggered the keyword alerts.

We've always been interested in investment properties and have been following BiggerPockets for many years now but never pulled the trigger.

I commend you for pulling the trigger based on having just enough experience, and not over analyzing. 

That conversion will not trigger any tax.Unfortunately we can no longer eliminate all of the tax simply by converting to a new primary and living there. 

Operating through an LLC can certainly provide some protection, but many mortgage companies include a "due on sale" clause in their contracts, which means transferring the property could technically trigger the need to pay off the mortgage. 

Just finished my major in Business Management and am receiving my Management and Supervision certificate this summer.I've been studying real estate for a few years now, have watched tons of videos, calculated and ran numbers on numerous properties and listings, and talked with many lenders and real estate agents, but because I don't have anyone in my circle that's well-experienced in REI's I've hesitated to pull the trigger on anything.I'm looking to fix and flip, BRRR, LTR, MTR, STR, or multi-family.

At what price differential would you pull the trigger on doing new instead of used? 

I have been very hesitant to pull the trigger anywhere outside of LA.

How do I ensure compliance with the LLC’s operating agreement and state laws?