So even if you pick a state with stronger protections like WY or NV, the cause of action arose in the state where the tenant fell, so likely that the court where the accident happened would have jurisdiction.California tends to have more laws on the books and requirements and restrictions that it can be a good idea to form a CA LLC for out of state property so that you as a CA resident are covered, and to try to have your contracts fall under the purview of CA courts.

Biggest risk is to workman's comp if they have an accident on your property and they don't cover themselves. 

The taxes will come due when the property is sold unless a 1031 exchange occurs (which in effect moves the tax due to the new property) or a new cost basis is established due to death.   

I will recommend just keep it local.Pros including but not limited: 1. you know the area better;2. you know more people that can help you;3. easy for you to manage;4. easier to manage by yourself, you'll also learn more while you managingThere always be new problems or challenges occurring every time you make a new investment in real estate even if you're experienced.The only cons might be that you have to take lower cash-to-cash ROI on paper compare to other places.

That is a different problem.I think my idea was for the renovation to occur while they held Title. 

How do folks normally establish how a payout will occur with investors?

I do have plans within the next few months to be creating a separate JV partnership LLC, and when that does occur, it will 100% be done through an attorney, and I will also inspect my original filings at that time.

Our original two rentals are filed on a schedule E, we are not "real estate professionals" (yet...).It occurs to me that we're paying for our down payment with after-tax money, and then, as the property generates income and we recoup this investment, we're being taxed again on the profit. 

Considering the current state of real estate across the country, we can anticipate that while a slowdown may occur in November, its effects will only be temporary.

Denver has boomed since so appreciation has occurred from the inflow of people to CO.