Some have classifications that would differentiate between apartments and other types of buildings.

Setup your properties as a class.  If

First the definition of section 1231 property:http://www.investopedia.com/terms/s/section-1231.a...Now links to counter the opinion of the OP's accountant:http://loopholelewy.com/loopholelewy/15-selling-yo...http://www.keithbakerlaw.com/documents/TaxLawExpla...This link is the one your accountant should follow in determining classification of gains and losses:http://www.cpaexamacademy.com/lessons/regulation-r...

Investors run the very real risk of getting burned badly when they use these very rudimentary classifications.  

Find out if your state has different classifications based on the number of properties owned by an entity.

This is the fundamental problem I have with Wall Street who takes too much fees off the hard-working efforts of the middle class. If

If you decide to go the turn key route, here are things to look for in the turn key company and what to avoid: Don't allow financing or a finance contingency (it can be a good indication they are selling above market value) Don't allow for your own independent property inspection Are not realistic with their pro forma's (i.e. they don't include vacancy or maintenance projections or use unrealistically low vacancy factors) Require you to pay for any renovation upfront Sell only in cheap. low end neighborhoods Don't accurately represent the neighborhood/property classification Don't have consistent rehab standards for all properties Don't provide a scope of work for the property Can't provide references of repeat investors Require you to close before a tenant is in placeI've been active in Indy for nearly 10 years and know the market well.

A teacher once told my class if we ever wanted to argue about a grade that we were given we need to wait 24 hours before he would be willing to talk to us about it.

Now, the main benefit of a second home approach is that the minimum down is 10% instead of the 15% minimum you find with investment classification (yes, it's 15% not 20%).

Mike your classification of absentee landlords is very insightful.Absentees could be split into three groups1) Out of State 2) Out of City 3) In CityThen use two four more filters1) Last Sale date of atleast 7 years ago 2) Minimum equity of 40% 3) Single Family Residences 4) Minimum bedrooms of 3