Do you like having more vacancy as that reduces the taxable basis to start?

However, doing so would be a taxable event and, if done before age 59 1/2, would also result in early distribution penalties.

Your net business income is taxable whether retained in the business or distributed to the LLC members.Please understand that your business assets are exposed in the event your business is sued.

If your company provides you benefits, some of them will actually be taxable.

What do I do when tax time comes, and will they define my taxable income differently that what I have determined my cash flow to be?

I wouldn't put them on the mortgage, like others have suggested, it can trigger taxable events etc.I personally would want to keep control of the situation by having complete ownership and then just have my kid be responsible for being a property manager as his way to live in the house.Be clear that there are different hats (as Dave Ramsey says), when your kid is over for Thanksgiving meal, you have your papa hat on. 

Depreciation from personally owned vehicle miles driven can be added back to your taxable number, to bring you closer to your true net number. 

But I think you're talking about cash flow, not taxable income, so subtracting the payment is reasonable.IMHO, getting $200 on a typical rental is pretty good.

I've heard that debt-financed real estate investment income from rents and disposition are NOT considered UBTI and, hence not taxable, and I've heard debt-financed real estate income is considered UBTI and that a form 990-T must be filled out to report these.

The Central Appraisal District (of each county) Determines the Taxable Value (TV) of each Property Annually.