I think it speaks volumes regarding your care to the situation the heir is involved in.

Companies that know what they're doing don't get involved with the race to the bottom. 

I would tend to agree with the other CPAs typically.The 500-hour test is one of seven material participation tests used by the IRS to determine if a taxpayer is actively involved in a trade, business, or rental activity. 

This allows you to test all the systems and the people involved.  

I just want to be involved and learn more so I could achieve more eventually.

It may be easy to rectify, maybe not, depends on your jurisdiction, the issues involved and the City's stance. 

The client can distribute proceeds through a private agreement without involving the title.

., FTC, HUD and others and the FBI does actually get involved to see if there is a pattern.   

The deal will involve complicated paperwork. 

I think if you are going to keep all three parties involved as owners of the deal long term then you need to separate yourself as a renter and a contractor.