There are plenty of banks across the US that also have a stated income heloc (in the Carolinas, First Citizens will do up to $100k with no income verification). 

@Charles Perkins is absolutely correct about "collecting all receipts, properly tracking all income and expenses and your basis for all assets properly documented and recorded."

If you can’t do a 1031 to a non-income tax state, figure out a year when you will have lower income and tax rates ar as low as possible.

The absolute best way to avoid taxes is not earn income.  

Do you have other ways to decrease your expenses or increase your income aside from real estate? 

@Victor Yang To use the rental losses to offset any active income (W2), you'd have meet Real Estate Professional status (which would be difficult to do with a W2 job because you'd have to work more on real estate than any other job to qualify) OR have an AGI of $150K or less.

That said, even with conservative rental income estimates, my living expenses would eventually drop to several hundred dollars less than what I’m currently paying in rent once the house hack starts generating income.I do have cash reserves to weather some rough patches, but the idea of pushing my budget this hard makes me uneasy.

Also, focus on 2 years of job/income stability.Class D Properties:Cashflow vs Appreciation: Typically, all cashflow with little, maybe even negative, relative rent & value appreciationVacancy Est: 20%+ should be used to cover nonpayment, evictions & damages.Tenant Pool: majority will have FICO scores under 560 (almost 30% probability of default), little to no good tradelines, lots of collections & chargeoffs, recent evictions.

It seems there’s a common misconception largely influenced by social media, online courses, and influencers who oversimplify the process that real estate is an easy, passive way to generate income with minimal effort.

If you are purchasing a primary home, income could be a challenge if you work at an office.