The first is if the LLC that you own the properties in is a disregarded entity. 

To not know or to disregard it is either going to be detrimental to your investments or is purely greedy selfishness.

@Kole KingslienA SMLLC that is taxed as a disregarded entity should not be running payroll for its owner.If your dad wants to take money out of the business he should do that as an 'owner's draw' or 'owner's distribution', which will be a balance sheet movement. 

Make sure you talk to a lawyer and don't take advice from some yahoo on the internet ;)Obviously the answer is always "it depends," but here are a few factors to consider:Is this a disregarded entity (or put a different way, is this a single-party LLC, i.e., just you or you and your spouse)?

I get it.. and I have no clue as to Brad quality of education.. like I said the name just popped into my head.. so please disregard my comment was not aimed at him or his student particularly just sharing my personal thoughts. 

Another very common DIY mistake I see in LLCs are people using operating agreements and certificates of formation designed for disregarded entities and partnership entities, which typically automatically disqualify the entity from electing S-Corp status.

Then as @Ashish Acharya laid out, C Corps and S Corps aren't likely to be the most favorable tax entity type.An LLC that is disregarded (SMLLC) or taxed as a partnership (MMLLC) generally would be the most advantageous for a US citizen who intends to hold long-term rental real estate.Best to run it by your tax adviser.

As these entities will be disregarded for tax purposes, there will be no tax filing on them.If you want to refinance one of the property, I would suggest to do it before transferring into the LLC as you will get better offer with a personal mortgage than with a commercial one.

@Nick R.Ask your CPA and 1031 intermediary but as a single member entity/LLC it can be a “disregarded” entity thus having the best of both worlds. 

I think it's a good policy and if you use it, disregard it at your own peril.