This is from HUD 10-121 issued June 11, 2010A familys source of income should never be used as a basis to discriminate against them, said HUD Secretary Shaun Donovan.

Questions I have:- do I structure the deal where investors are paid out on an annual basis or keep them in as equity partners until we refi once the project is complete (3 to 5 years down the road)?  

Don't do it, unless you will really utilize the amenities on a monthly basis.

It looks like they are sending out refund contracts kind of on a first-come, first-serve basis, with some levels of priority because there are so many investors in these deals, which is why I'm posting this to get moving on this ASAP given the number of investors who are jumping in for refunds.I do not recommend you stay in this deal because they will be raising prices.

I feel like it's mainly a case by case basis depending on reviewing leases and policies and make a decision based upon the exact circumstances. 

This is my basis strategy when accumulating primary from where it was 400k-500k back in 2010-2013 era; the appreciation is double inflation, 6% ; and interest rate is 3% ; making this strategy is equivalent to 16% CD rate.

You can also consider selling and reinvesting your winnings then you never have to worry about the cost basis of your investment.

So, your basis for capital gains is the value of that property a few years ago.

Your gain is sales price less sales expenses less adjusted basis.Your adjusted basis is purchase price plus improvements less depreciation.Also factor in any passive loss carryforwards when calculating your gain.Your CPA should be able to discuss with you what tax implications would be upon sale.

I don't want to invest in something and then the City shuts down the development idea that is the whole basis for the investment.