But I also love the idea of investing in real-estate and utilizing its tax benefits I have read around 10 ish books or so and the one I am reading right now recommended this site I am looking for some advice of things I can do to either prep for an investment into real estate and or do right now.

It seems like every city, county, and state has its own rules, permits, and tax requirements for short-term rentals, and I’m finding it overwhelming to navigate all the different layers of compliance.For example, some places require business licenses, transient occupancy tax permits, or even special zoning approvals.

@Luke H.Hi Luke,  As a private money lender myself I will focus on one element of your deal---5 years is a long time to be finally paid. 

Would the federal tax liability be $140k at year 5 for the sale, with long term capital gains (ignoring any Net Investment Income Tax)?

So, instead of paying taxes on $50K, I'm paying taxes on only $21K. 

This should include potential rental income, expenses (including property taxes, insurance, maintenance, and potential vacancy), and your expected return on investment. 

Can anyone recommend software which would accept monthly payments (from me to seller) and create proper 1099 forms for tax purposes at year end? 

I’m talking about getting thorough with expense estimates, factoring in property taxes, insurance, and a cushion for maintenance.

For example, I have two STR high-income earners (making 140k & 150k) in Joshua Tree for sale with low expenses, where the sellers will stay on to manage it.Making sure you are keeping as much as possible from the tax man is a huge component and to do so you usually have to invest it.

I’m told taxes and insurance is lot and will rise each year and cash flow is hard to come by.