The IRS also says “you can choose to treat any debt secured by your qualified home as not secured by the home.”So... this leads to interest tracing rules which are not complicated but it begs more questions-What's the land for?

Be sure and send them a final accounting including the security deposit to any forwarding or last known address. 

Would someone be able to fill me on in what is required with regard to bank accounts in the state of NC for holding a tenant's security deposit? 

Since the start of the year, I've read a handful of BP books:- Rental Property Investing (Brandon Turner)- How to Invest in Real Estate (Brandon Turner/Josh Dorkin)- Investing in Real Estate with No (and Low) Money Down (Brandon Turner)- BRRRR (David Greene)- Multifamily Millionaire Volume 1 (Brandon Turner/Brian Murray)- Start with Strategy (Dave Meyer), currently readingI was thinking of using the equity to BRRRR small multifamily properties and combine some concepts from both the BRRRR and Multifamily Millionaire books (specifically making cash offers via HELOC to secure distressed properties, ideally vacant to set market rents).

Sara maintains a California business bank account and secures financing in California for the LLC’s Texas investments.

Handling Maintenance requests and emergencies, Handling tenant disputes, Ensuring the tenants are properly insured (if you require them to), Marketing the property, Screening applicants, Handling the security deposit return, and a whole lot more. 

Ideally, a location near a hospital or other attractive amenities is ideal.The upfront investment you would need is the Security deposit and 1st months rent, and cash to furnish the unit.

Most lawyers have said this is a security and I need a syndication, but most accountants say they set up LLCs that way all the time...

It sounds like at least some of the charges to your security deposit might be valid. 

Security for one - so put them on title as co-owner.