California does not recognize Real Estate Professional (REP) status, but you can still claim it on your federal taxes if you qualify.

Be sure to hold a hefty reserve to handle on-going maintenance, capex, taxes, and insurance.

Quote from @Zara Massoud: Your new PM is correct and the old ones were wrong.The property manager must have your social security or tax ID number on file.

I used to live in the city and the taxes and water bills are nightmares.

It’s definitely smart to evaluate the tax and cost implications of your funding options.

@Andrew Slezak Opportunity Zone (OZ) investing allows you to defer capital gains taxes (e.g., from crypto) by reinvesting the gains into a Qualified Opportunity Fund (QOF) within 180 days.

In Minneapolis, are there programs in place from non profits and the government to aid first time home buyers with costs?

The fact that you have a TAX-FREE income is crazy good.  

Yes, do the tax exchange if you can.  

And must be pretty significant unreported income if it would have caused $45k in state tax liability.You advised your client to wait past the expiration of state statute.