Therefore, the IRA is subject to UDFI (Unrelated Debt-Financed Income) and the IRA will owe tax at a somewhat hefty rate.  

If you just flip the house or occupy it for less than that allotted time, the profit will be taxed as self-employment income under your tax rate.For a more in-depth article about taxation, read this: https://www.biggerpockets.com/renewsblog/2015/05/20/tax-benefits-real-estate-investing-rental-properties/You should always talk to a CPA about taxation and develop a tax strategy with them before getting involved in real estate.

I'll assume you didn't make an election on behalf of the LLC for it to be taxed as a Corporation - if so then partnership taxation would be correct since the LLC has more than one owner.

Less paperwork (with Corp you have to file a resolution each time you take a decision/action)Pass through entity is better on tax at this point (cash flow strategy will be seen as income as opposed to capital gain)Less expensive to manage Hope that helps.

I personally don't like LLC's because of the double taxation as well.

For our case we financed using a HELOC on our own home so did not face that issue.(4) An LLC can have one of two different types of taxation rules applied:  Partnership or S-Corp.  

Generally, a Roth conversion will result in taxation on the converted amount.If the funds will be a downpayment and your IRA or 401k will seek financing for the rest of the purchase price, a non-recourse loan should be used.

good question. ...the LLC structure can provide you with the structure you are looking for and the ability to protect your personal assests. your state department of taxation and assessments website should have printable forms, directions and fee list. lastly, the llc structure can allow for you to have one business for ALL of your real estate endeavors or multiple llc's in order to separate the flipping from the rentals, thus insulating the revenues in case one falters.try searching "best business structure for real estate flipping"......this will lead you to many articles and once you digest them you will be more confident no matter what structure you pursue. .... hope this helps.

However, due on sale, series LLC vulnerability, and taxation under this structure is of concern to us.

Unfortunately at the moment the US and the investors country (Chile) does not have a double taxation treaty signed.