What if the lien was transferred into your name?

That being said I will admit that covering transfer taxes both times can hurt your bottom line.  

I purchased a tax lien that was sold the next year with a “warranty deed” The lien was for 2022 taxes and the deed was transferred in 2023. prior to the transfer there is a long history of tax sales and different names paying taxes including a previous investor. how far back does the line of interest go and would the previous investor be considered someone who “holds interest” in the property?

Transfer tax on the purchase and also the sale.

All you're doing is transfering cash from your bank account to the property. 

A DSCR loan allows for a cash-out refinance based on the property's cash flow, and a quitclaim deed at closing can transfer the property into an LLC, with only the transfer tax to consider.

I do look to grow beyond two properties, but not necessarily at a rapid pace.Finally, if I were to do this, what are the proper steps in forming an LLC and then transferring them into that entity?

My list includes - last 2 years employment history and current employment [2 paystubs], criminal checks, eviction checks, No Pets, No smoking, tenant pays utilities, maintains landscape, no subleasing, bring own washer & dryer, 1 month security deposit and transfer of utilities before moving in, rental insurance, all occupants will be on lease, notice period of 2 months for termination, tenant references, No cosigners, no painting walls, late fee notice, any hoa fines should be paid by tenant, inspection of property at 3, 9 and 12 months.Please let me know if I am missing anything.3.

Sadly, there is no precise “right time” to begin.

But don't see enough near-term or mid-term upside to keep them if something better comes along elsewhere that I can transfer into.