The confusing part would be, how much of the 38K is allocated to recapture and how much is allocated to LTCG.

Hi Mike, I believe you could purchase a property on which you reside and also have an investment property, but you would have to do a reasonable allocation between the two and two separate sets of accounting.

So I think it’s about allocating some to stocks some to real estate some to whatever other businesses you want to invest in.

Lets look at some rough numbers.If you bought for 400k, and we allocate 25k to land.

Conduit type and asset allocations? 

Structure and allocation will be key to how you do it.  

@Jason Moran, if your funds are not eligible for transfer, consider contributing less (perhaps enough to secure matching funds if they are offered), and allocating your investments toward the safest investments from what is available.

If you're in the wealth building phase, it's a no-brainer to arbitrage the extra money and allocate that towards an asset with a higher return than the mortgage paydown. 

You said it was a duplex and you;re in half so you have to allocate the insurance, the taxes, and the mortgage interest because the personal part of your interest and taxes is reported elsewhere.

If you ever have to dissolve the LLC at that point then allocating the assets of the LLC to each individual member becomes a much easier manner.