For example, you could create a weighted structure where a percentage of profits is based on cash contributions, and another portion compensates for rehab or management efforts.Rent Payments and Tax-Free Profits:If you structure it as an owner-occupied property, the rent you pay could be shared proportionally, but tax-free gains on resale may only apply to your share, as you’d be the owner-occupant.

If the purchase is done in cash, as you mentioned, they’d have more flexibility, but they’ll still want to carefully consider the tax and legal implications of the subsequent sales.I hope this helps, and good luck with your client’s deal!

CA has property tax rate that is a little lower than the median.

Credit is a factor as bad credit may limit options, or may have the lender require you to put 10 or 20 years of taxes and insurance into escrow. 

An annual business tax as a hotel of $50 and collection and remittance of transient occupancy tax of 12% from renters is required of all short-term vacation rental operators.

Your requirements to defer all tax are to purchase at least as much as your net sale. 

Thats $7700 a year NOT including my accountant/Tax prep. 

The property was rented and generated $160 cash flow after mortgage, taxes, insurance and property management fees were paid.

How does this look from a tax perspective.

Someone can be a brilliant tax person but horrible to work with, and also vice versa.