@Eugene Lubman Selling the property to your parents allows them to generate passive income while enabling you to perform a 1031 exchange to defer capital gains taxes.

Whenever I see someone giving advice, I like to ask "who benefits"?

However, those few who are financially saavy and have integrity and grit I believe will benefit from it until they are able to have enough experience to go off and do their own thing, charge less fees and be able to have more repeat business while keeping a much higher ROI themselves.And NO, i've never been in this program, been around much longer than he even thought of this revenue stream. 

B) Worst case is I sell my current home, move into the foreclosure, live in it for 2 years, and then resell without the capital gains tax hit.  

You are an absolute loser for defrauding thousands of investors for your own gain!

Yes the financial benefit is attempting, but I do want to understand all the legal consequences, including insurance issues before making a decision.

This is like when a seller says they don't want to pay capital gains so they want 200k on the contract and 200k in a bag.

Thanks folks, it seems like overall it doesn’t make the most sense to start an LLC for real estate purposes due the cost and complexity, with few benefits here in California.

Partial 1031 Exchange: If you back out of the condo deal, you can still defer taxes on the portion already reinvested (the vacation rental) and pay capital gains tax only on the unused portion ("boot").3.

My first thought was sell to lock in your tax free cap gain.