Spreading of the tax ("installment sale treatment") may be prohibited for some transactions between related entities AND also between relatives.

Qualified vs Nonqualified Roth IRA DistributionsThe tax treatment of Roth IRA distributions depends on whether the distribution is considered qualified or nonqualified. 

There is virtually no way to avoid this treatment by California although there are a few BP yahoos who might tell you otherwise.

You simply do a heat treatment of the house/apartment.

However, he has been treatment it, reporting it and filing it as his own property (as a rental), so now hard to say it is really your house. 

The rich have way more treatment options, rich neighborhoods have more *SPACE* to insulate from noise and disturbances.

We just picked up a higher end 5 bed 3 bath with pool that we are setting up for STR family events (reunions, bachlorette parties, anniversaries, super bowl, Barret Jackson Car Show, TPC golf turnament, and your regular "I want to get out of MInnesota into the sunshine and warm" crowd, etc) and the costs are much higher than your quote.If you want to keep things under $1,000 an apartment, I don't think that includes bedframes, mattresses, linen, night stands, window treatments, and so on.

Morby and others wrongly say take installment sale tax treatment on the sale on a wrap. 

Treatment by shareholder of corporate assets as own.5.

Proc. 2002-69I found this guidance and thought I would provide a summary:It was issued to remove uncertainty surrounding treatment of an entity owned solely by a husband and wife in a community property state.Essentially, if that entity is a "qualified business entity", and the husband and wife choose to treat it as a disregarded entity, the IRS will respect that classification.On the flipside, if they choose to treat it as a partnership for Federal tax purposes, and file a partnership return, the IRS will accept that the entity is a partnership for Federal tax purposes.A business entity is a qualified entity if:1) The business is wholly owned by a husband and wife as community property under relevant laws,2) No person other than one or both spouses would be considered an owner for Federal tax purposes,3) The entity is note treated as a corporation under Reg. 301.7701-2