A FHA 203k Loan is where the purchase price and rehab costs are rolled into a single loan.The downside of using FHA or a FHA 203k is you will need to live there, for a minimum of one year (to satisfy FHA Requirements); AND because you closed personally, you will not have Asset Protection, in the form of closing in the name of a LLC.

Protection from lawsuits is a big item to consider as well, especially in higher price range properties. 

In some cases, it may not be possible to purchase and store materials, but if it is, that is one way to protect your budget and avoid a costly mistake.The last thing I would offer for you to think about is having a pivot plan. 

There are ways to mitigate the costs and protect yourself to the extent possible.

Additionally, there typically are additional state protections (outside of the agreement) based on where the fund is located.

A well written management contract should clearly spell out what is expected of both the PMC and the owner, to PROTECT both and avoid misunderstandings.

Translation: you helped your client to protect their cheating against the state assessment.I understand that your client, as a result, avoided paying $45k.

You have to protect your assets and your family.Yes to all over 18 years old.

You do not need to have it under an LLC to take depreciation, the LLC's purpose is to protect your personal assets should you get sued.  

Include a buyout clause allowing you to transition to sole ownership after two years, based on a pre-determined valuation formula or market value.Use an LLC to hold the property for liability protection and pass-through taxation, ensuring both partners benefit from depreciation to offset rental income.