Their $5k fee could be a set up].Your plan is a variation of Credit Card hopping - transferring ones balance every year into a new trial period Interest-free Card.

Otherwise, use IRS schedule. 1. 

What documentation will I need to provide to the IRS in the event there are any audits? 

The example that was given to me was that if your property goes up in value $100,000 in a year, you would owe the irs $25,000 at the end of the year wether you sell the property or not. 

I have all this cash in hand and I feel IRS is going to take a big chunk from it.I just did many repairs/improvements on the other property as write offs to help somewhat when I file next year.

It is important to understand this and other prohibited transaction rules so you can stay out of trouble with the IRS and avoid costly penalties.

For tax purposes, the IRS sees you and your LLC as the same entity, so transferring the title to your personal name typically wouldn’t affect the 1031 exchange deferral.However, to maintain the tax benefits associated with the 1031 exchange, it’s important to ensure that the property remains a rental and continues to be used for business purposes.

An LLC and IRS Employer Identification Number can be used to open a business bank account. 

The government and IRS got wise to landlords taking these direct payments and not reporting them.

It is just the IRS tax rules.Next up is I would get a good CPA and go over your plan.I think you aren't going to be able to meet your goals but being involved in the construction.