They'd be much better off being a Hard Money Lender and make 5 times that (and every repair to their "investment house" is paid by them...So, if you put $10k down on a property and make $150/month net cash flow your Coc Return (annualized) is 18% which is Very Good.If you followed that and understand it then keep looking for a deal.

As a first step, I’ll print and read The Ultimate Beginner’s Guide to Real Estate Investing.

I really like LLCs compared to corporations because of the free stepped up basis for passing property to my children. 

Congrats on taking the step, you go this!

However, if you inherit it through her estate, you receive a stepped-up basis to its fair market value at that time, reducing tax liability upon sale.Gifting it now has no immediate tax consequences unless its value exceeds the $18,000 annual gift tax exclusion (2024).

Anything past that might feel weird.Good job going to your first one, that is a great step that too many people miss out on.

Taking small, manageable steps now will help you make informed decisions when you're ready to invest.Good luck!

Cons - Risks as stated by others, can limit which renters are looking at your house. 

You ARE subject to CA LLC tax just by the fact of YOU being a CA resident, sorry.

By this logic investing in a new roof also doesn't make sense.