I’m in the 33% tax bracket through my real job and this could be a big difference in taxes owed if we sold the property?

It is tax free in the sense that you will not owe taxes today on the cash-out.

Home went to tax sale county kept excess proceeds.

And of course we're in agreement on consulting a tax pro.

For several reasons (property taxes, politics), I would prefer to begin real estate investing somewhere other than locally. 

Tax credit 45L for a 90 unit or 112 unit project? 

What's even more frustrating than asking the IRS help desk, is asking a Turbo Tax "Tax Specialist".

If you live in CA, and your LLC is in OR, you still need to register it in CA and pay the 800 dollar per year LLC tax.

@Tyler Speelman, A 1031 exchange solves the tax issue. 

Note the property tax will be -10% on the rent by itself.Month 0 to 24: $2450 * 0.5 - $1573 =-$348/monthMonth 24 to 60: $2450 * 0.5 - $1541 =-$316/monthNext issue is due to the low leverage starting at month 24, the ROI takes a beating.