Multi-family depreciates on the same 27.5 year schedule as 1-4 unit residential real estate.This combined with using the whole amount invested plus the loan as the basis for depreciation shelters most if not all income for most investors.REIT income on the other hand is typically taxed as ordinary income (which for a California investor at the top tax rate could equal as much as 52.9%).You also wouldn't be able to take advantage of the 1031 Exchange if you invest in a REIT.

For example, you may want to instruct them to email you for ordinary questions and text/call for emergencies.I also schedule a mandatory inspection within one week of purchase.

Catch up provisions aren't included in every offering, but they're certainly not out of the ordinary. 

However, if you are transferring some of the proceeds from the rental business into the property management business you are essentially converting some of the income from rental/passive to ordinary income.There are Pros/Cons for doing thisCon - Your property management income will be considered ordinary income subject to self-employment tax.Pro - You may not be put a portion of the property management net income into a retirement account.Con - You may now need to file additional forms with the IRS increasing your accounting fees.You may also need to file a payroll tax return.Pro - If your property management company runs as a loss and you were not able to take the losses on your rental business - you may not able to take some losses there were previously unavailable to you.

But even if you only slow down the flip to more than a year that changes the taxability from ordinary income to capital gains.There are three things to this strategy.1.

Does it all equal out in the end because we are getting to write off the mortgage on our primary residence off our ordinary income or does it make sense for us to have a loan on the investment property itself?

The rest are ordinary people as others.

First impressions are important and can attract quality tenants.Offer amenities: Consider adding value by providing amenities such as laundry facilities, off-street parking, or outdoor spaces like a patio or balcony.

@Sam Stolt...sorry for the real late reply....been on vacation :)If you have an insurance claim and the adjuster sees something that makes them question if something was done out of code, they may investigate it and if they find its was not done to code or w/o permit, they could deny the claim....they would have a good case to deny it.... depends on the insurance company.My own personal experience...... my own residence..... had 2 small room additions that we knew at the time of purchase were not done with permits, but were very basic and we had no code concerns...... 6 years after purchase we got a call from the city...wanted to know if we ever finished the work that had an initial permit pulled on...never got final inspection or approval....... turns out the original owner had started a permit for an "enclosed patio".... they then built full on room additions.

.➡️ Operating ExpensesThe IRS lets you deduct “ordinary and necessary” expenses paid to manage your Memphis rental property and run your business (i.e. advertising, pest control, repairs and improvements, tenant screening, utilities, and more.)➡️ Property Taxes and InsuranceInvestors have to pay property taxes and insurance regularly.