Most of mine have infinite ROI, but I have 3 that for various reasons were not  refinanced to extract my investment (one had no value add, the other 2 have not been refinanced to extract the over $1m value increase due to rate increases). 

You could do a 1031 into a DST, thats entirely passive.If you extract 10M equity equity and invest conservativley with a 5 CAP thats $500,000k a year in todays money.

In this situation you can't just form a sole prop or DRE property management company with the goal of reporting the management fees extracted from the rentals on Schedule C. 

If the rental income significantly exceeds the normal write-offs (standard expenses plus standard depreciation) then there are options including extracting value via a refinance (reduces the cash flow), do a brrrr or other costly value add, or do cost segregation.  

The impression I got is that they just want to extract from you and not give you anything of real substance in return so Danger Will , Danger will.  

House hacking a FHA duplex with high LTV, off market purchases, a BRRRR that allows you to extract all or virtually all of you investment, lease to own, etc.  

Not only could it save your skin, but also dissuade stupid lawsuits because you would be too hard to extract money from.

It sounds like you have a solid plan in place, and I'll provide some insights and advice based on your questions:Maximizing Investment Longevity:It's a smart move that you're house hacking with an FHA 203K loan, remodeling for appreciation, and then refinancing to extract equity for other investments.

While forced appreciation—that is, renovating buildings to raise their value—is the main method of extracting wealth in the BRRRR approach, long-term property appreciation can also boost total returns on investment.Financing Options: To finance the purchase and renovation of properties, investigate the availability of financing options such as hard money loans, private lenders, and traditional mortgages.

instead, they expect you to extract and fill out a GENERIC 'organizer'  when you try to list the data that is missing at the bottom of the 'organizer' they dont read it!