All existing STRs with 2 days rented in the last year will be granted legal non-conforming status.  

In 30+ years we've been sued 1x (legal blackmail over a tenant's drunken trip/fall) which the insurance company settled for $1,500.00).We've been using some privacy tactics to keep our names off the county recorder and the target off our backs.Further, we review our insurance coverage and premium annually, just to keep on top of any changes.As with all insurance, it seems to be a waste of money... until you NEED it!

Are there other legal or financial consequences I should be aware of?

Additionally, tenant issues and legal complexities around eviction can make management more difficult.

I have never done this just thinking out loudNo legal advice.

Yes, I have general expenses that are not attributable to a single property, like legal and accounting and home offices like you mentioned.

Perhaps if your partner was a general contractor or handyman type there may be some merit there to reduce costs / increase profitability.If your partner enjoys deal sourcing, a better move might be for him to become an agent - so he could legally collect commissions from finding deals and managing properties for multiple people. 

I did serve a 5 day when they were late for rent and can legally nullify the lease and do a 14-day notice in Wisconsin and escalate for an eviction if it happens again. 

Quote from @Stylianos Kalamaras: Yes they are, they cost me $800 knowing they would not close my deal and waste my time, if I had any possible legal recourse I would take it they shouldn’t be allowed to operate it’s really sad.  

I won't be able to make the cottage legal rental without living in the primary home myself.