That would be “leaving money on the table.” 

Our portfolio currently cash flows, but cash flow isn’t our top priority right now since we plan to use this portfolio to supplement our retirement in 12 years when I leave the Army.My biggest challenge is committing to an out-of-state market.

It is right on the fringe of being legal/illegal, and lawmakers have been talking about how to regulate it for years because it can be a dangerous process that leaves end Buyers feeling like they weren't represented.....especially when they see the closing statement and find out how much the wholesaler made just by getting to the Seller first. 

If I leave this amount in Sch-E, I get taxed at ordinary income tax rate at Federal and State level, which along with my regular W2 income can be substantial.

So we moved to liquid and only leaving it a third full.

Or simply just leave it in their name?

I didn’t see your location in your profile or your post, but assume at least 17% state/federal taxes leaves you with $10k/yr. 

It cashflows like crazy as is, you take out a tax free loan of $1.2M give or take, you leave it to your heirs when you die and they pay zero taxes. 

I am trying to assess whether I should take it solo , leave it or scout an experienced partner.

You also do not want to be too cheap and leave money on the table.If you do all of that you will be well on your way to being successful.