And then potentially we may be able to defer the taxes indefinitely.  

They are quoting: RCW 59.18.900 Severability—1973 1st ex.s. c 207.If any provision of this chapter, or its application to any person or circumstance is held invalid, the remainder of the act, or its application to other persons or circumstances, is not affected.This is what I would send themRCW 59.18.200 Tenancy from month to month or for rental period—Termination—Armed forces exception—Exclusion of children—Conversion to condominium—Notice.(1)(a) When premises are rented for an indefinite time, with monthly or other periodic rent reserved, such tenancy shall be construed to be a tenancy from month to month, or from period to period on which rent is payable, and shall be terminated by written notice of twenty days or more, preceding the end of any of the months or periods of tenancy, given by either party to the other.Unless they are in the armed forces and deployed,  they only need to give you a 20 day notice from the end of their lease. 

Hi Kathy the other alternative without the dst “tie up” is through a trust instrument that can set up the installment sale for you, defer your capital gain, even indefinitely, and be able to invest in whatever asset class you like, in whatever time period you prefer.

If you are in the 15% bracket, then your depreciation recapture rate will be 15%.If you always 1031 and never have a taxable sale, you can defer the capital gains tax and the unrecaptured depreciation tax indefinitely. 

If we were planning on living in it indefinitely than the return on this investment would be more moot because the venture would end up being worthwhile over time simply from the rents and regular appreciation. 

If my intent is to convert our current home to rental when we upgrade and hold indefinitely (i.e., long past the break even date), is there any reason I wouldn’t want to consider purchasing discount points from the refi lender?

But it was a non event for me as rents weren't impacted and I had enough cashflow so that they were indefinitely self-sustaining. 

I plan to rent this town-home out indefinitely. 

Account ClosedIf you have good net cash flows, bought all cash, or great interest rate, you can hold indefinitely and ride out the next recession.

Our plan was live in this home indefinitely, but now we have found some other homes that were potential homes for us, as we were searching for our next rental.