You should consult with a securities/private equity attorney for some information on the legal way to market this opportunity. 

But fear not, my fellow investors, because these issues are slowly but surely getting better, and with the simple diligence of keeping an eye on those sneaky property taxes, along with the ever-increasing insurance costs, you will do great.Speaking of golden opportunities, the MHC market has become more institutional, meaning more opportunities for those of us with a keen eye for quality investments.

If I want to use the STR tax loophole, would living in a different state affect the advantage of the so called STR tax loophole, as long as I remain active in managing the property and fulfill the other requirements?

I agree with @Christian Styles; consult a landlord attorney in your state.

It may be beneficial to consult with a local real estate agent who can provide insight into current market trends and investment opportunities in both Connecticut and New Jersey.

This will drop the tax rate.

Most of the other regular costs associated with the loan apply... appraisal, doc fees, county taxes, etc.  

That is not reflected in the lawsuits related to this issue.You make no mention of the escrow costs or tax implications or transfer taxes or scrutiny that is involved with a deed back.

Get estopples, copy of leases, and ask for bank statements and tax returnsIf they don’t have it then I would assume worst case on every asset and price it accordingly

Thanks It's probably an ad for a credit card stacking consulting company.