Bottom line is - pay for the expert advice on this one.

The other part of this is that in addition to this, we are borrowing from our home equity line of credit to put down the 20% deposit- so we have that payment too.   

He's already making (effectively) around $350/hr - if he's paid on production he could also just make another $175k a year with those hours. 

Especially when considering the tax implications, current interest rates, and if you don't have another purchase lined up.Happy to send you an analysis and proforma for your properties as they stand right now, kindly reach out anytime. 

Unfortunately, this reassessment is unavoidable, so you’ll need to evaluate whether transferring the property is worth the potential tax increase.If a Transfer Is Not Feasible:If the potential property tax increase makes the transfer impractical, an alternative option is for your father-in-law to secure a Home Equity Line of Credit (HELOC) on the property.

My current line of thinking: Is it possible to just "transfer" the properties to LLCs owned by the individual investors and not consider it a sale? 

Scroll down to page 6, Schedule L, Balance Sheet per Books.https://www.irs.gov/pub/irs-pdf/f1065.pdfLook at Lines 7a and 19a.

Small shop brokers that have access to multiple programs so that they aren't beholden to one or just a few loan programs will typically get the most competitive product for the borrower. 

Set aside a big pile of cash or rely on a line of credit you won't be using.The oversimplified insurance concept is to pay a small premium to cover a large loss.

------------------------------------------------------------------------Here's our current guess: "The builder's plans and the build may not line up perfectly, so the buyer could sue for breach of contract or a similar claim."