Many wanted to prepay taxes before the new federal tax law took effect and claim it on 2017 returns.

There is a big difference between the escrow/trust accounts of such an entity and holding your proceeds in an actual FDIC insured segregated account with a Federal Reserve chartered bank.  

I don't have a business account or federal tax ID for the business since it has just been me thus far.Can I just 1099 him at the end of the year for what I have paid him?

Anyways, I have been learning a lot here and look forward to learning a lot more, if you all can take my stupid questions.I work full-time as a cancer data specialist (contractor for federal gov't). 

awe don't have state income tax so is the federal the same in every state?

Before I retired, I was a broker, residential/commercial RE appraiser, expert witness in State and Federal Court, and a professional RE investor.

It defers it indefinitely both on the federal and state level in all states but PA. 

The 1065 didn't do much for them except satisfy a check in the box for the filing requirement because they formed (and operated) a multi-member LLC, which is (by default) a partnership under federal tax law.You can share profits and expenses on rental properties without forming a partnership.

Aside from my own home (near Federal and Evans) I can't afford anything else in Colorado.  

@Autumn WebbIn addition to federal and state taxes, if you are under age 59 1/2 at time of the distribution a 10% early distribution penalty will apply.