I would look at alternative investments if you want RE exposure-- REITs, Mortgage Notes, etc.

Subsequent years: Alternate satisfying test #3 with one couple participating in at least 100 hours of activity (and more than any other individual) and the other couple not meeting participation test. 

Alternatively, you could install energy-efficient fixtures and appliances to help keep utility costs down for both units.

Alternatively, the idea of finding high network individuals to invest as equity partners also is perplexing.

(I worked in customer service previously, verbal judo is a required skill IMO)4) Go nuclear.

At the same time, if I dont buy an alternative, then I will never be able to depart with my expensive house that is a bad rental...

Alternative.

Absolutely not, but every investor should see the red flags and consider their alternatives before moving forward. 

This way instead of filing Schedule C for the LLC it will file it's own tax return separate from yours and will issue K1 for both yourself and your spouse.An alternative to that is you can hire your spouse to work for you and pay him salary.

If you read up on it minimally, you would probably come to the conclusion that it makes no sense to pay someone to do what you can easily (and cheaply) do yourself.I recommend this, not because it's better than REI, but because (1) it is an alternative and/or (2) it is a pretty decent place to leave your money while you wait for your next deal.