People becoming wealthier and stimulating the economy?! 

I work for the sake of working, the challenges, something to satisfy the needs of a workaholic,  the money is simply a by product.I spent 35 years in a career that was far from stimulating but understood that money makes the world go round.

Once you have them on the phone, you can ask them to describe their house to stimulate conversation.

Hi @Jeffery Neal, I'm a new investor myself so my reply here is not to provide an "answer" but to stimulate the right questions so you can decide what's best for your personal goals.

Because of the lower inventory that's stimulating this raise in home values, rents in Sacramento are surging to higher and higher prices. 

Becca, I am very pleased you found the discussion stimulating.

This does not directly answer your question about shielding rental income from taxes, but might stimulate some other ideas.

I know that they are building a ton out there and they are trying to stimulate economy there and capitalize on tourism based on the below article.  

If you hold beyond these time frames, the compounded impact is exponential.Some investors combine cost segregation with bonus depreciation and they don't pay taxes for many years, they reinvest those savings and drive their after-tax returns up.The tax code is designed to stimulate commerce and this treatment gets investors to transact (which generates income for brokers, inspectors, appraisers, agents, title companies, attorneys, contractors, engineers, regulators...the list goes on).

Maybe they do actually have favorable terms for commercial stuff...lord knows they're trying like crazy to stimulate the economy on this island.