So, it would then potentially cost you a penalty for early withdrawl and also income tax owed on it.

This type of investment can also offer great tax deduction, depending on your situation.Best of luck on your first deal, feel free to connect with more questions.

Also assessment never picked up those multiple sales and the parcel was being taxed at 8 acres. 

Legitimate, in this case, means that the entity is part of an overall business investment strategy whereby you have a business plan, tax returns, and the funds you seek are for further business expansion.If, however, the LLC is a stand alone entity, is not profitable, or is not legitimate, then your probably better off putting into your personal name and securing funding that way, or still talking to local or regional banks to see if they have any loan programs available where you might be able to secure financing.

In addition cash flow is taxed annually.  

So I do not have a tax filing with the rental income on it yet.

Tax deliq, preprobate, etc.  

But weigh the costs of insurance and taxes against the cash flow and make your decision accordingly.

You can find the most recent sales price for the property on the local tax records website or by doing a quick search on Zillow.

The property is distressed (unpaid taxes for 2 years).