Here is the summary if you are interested.In this case, the main question is when did the investor completed his start-up phase and became actively engaged in his business.Whether a taxpayer is engaged in a trade or business is determined using a facts and circumstances test under which courts have focused on the following three factors that indicate the existence of a trade or business: (1) whether the taxpayer undertook the activity intending to earn a profit; (2) whether the taxpayer is regularly and actively involved in the activity; and (3) whether the taxpayer's activity has actually commenced.

To qualify for ANY tax exclusion under IRC section 121, the taxpayer must convert to principal residence use hand hold for an additional three years (so the holding period is no shorter than five years).

If married, that would be a $1.5 million writeoff against your overall gains.  

I understand your apprehension about rates, but as the old adage goes you "marry the property but date the rate".

The filing is a public record and when you file put maiden married etc. names DBA crazies.

i find ones who honest up front and honesty is confirmed by paperwork ate usually pay rent consistently  but anyone on taxpayer funded a long time or who have been evicted prior are more "dangerous" more likely not pay rent  than any felon.3. 

Realistically, I will be living in CA for the next ~5years; however, I'm not married to the area I'm currently living. 

Plus, you'll be changing tax payers right before a sale and 1031. 

Timing of payment will depend on if you are required to make estimated tax payments.

If you owner occupy and rehab the home around you great while looking to sell at the 2 year and a day mark or later (to wash up to 250K as a single owner occupied/500K if married).