Different strategies call for different procedures.

But nope I just put the tips on my site LOL. .It really is amazing what is 2nd nature to me/us that others do not know.

I also disagree with Michael, due to some language in the annual revenue procedures that discusses what we can do with depreciation changes. 

Pay-to-play is somewhat true because when you join a good coaching program, which is an active community, and surround yourself with fellow investors who are actively looking for deals, opportunities will naturally cross your desk.

You'll need a lawyer to generate the paperwork and filings and experienced enough to give you general advice on the process, help you establish appropriate compliance and back office procedures.

It may depend on if you want a more formal procedure, or added protections such as all the inspections that go along with a traditional sale.

I am curious about this nature of the business as I build my REI business.

I was in a situation similar to yours and I have a duplex corner unit with a natural basement egress and tall enough ceilings.

You'll need to provide Entity Docs for each LLC that is a part of the transaction so that the underwriters can review them all the way down to the natural individuals/warm bodies. 

To do that, as long as you don't hit any of the standard tests (just google "material participation tests" to find the 7 tests), you are passive, and you can offset that income with your other passive losses.It will all come down to the nature of your involvement.