You often only have to worry about tax upon the profitable sale of an asset. 

Rochester, NY is a very hot market, there are very few homes for sale.  

I wanted it to be passive since I have a full time job in tech and cannot do what "boots on the ground can".3.

To do with other ppls money, you need that personal relationship with the money source and then they have to trust you in terms of market research, boots on ground, analyzation, contracting, and exit sale. 

It's super competitive here and we have a large flow of off-mkt homes coming our way, so we had to develop tools to speed up acquisitions/underwriting.I built something that allows VA's or very green staff members the ability to properly distinguish opportunity as if they had years of expert experience & local market knowledge.It will run sales comps & estimate ARV for you:And has drilled-down market stats that are actually useful!

See, in SFR (1-4 unit) the primary driver to valuations is comp's, market sale comparable, what so-n-so sold there place for last week/month etc.. 

Are properties such as this more appealing to buyers with renters already on leases or will I get more interest and a higher sales price if I sell the property vacant?  

You could use the equity from the sale to get back on track financially and reinvest in a more manageable property to kickstart your investing journey.

Texas property tax sales.  

@Rud Sev Your Section 1231 losses from the sale of rental properties were likely correctly reported on Form 4797 (Part I) as ordinary losses, allowing them to offset all types of income.