If they didn’t have replacement cost, what should they do to capture value and get a loss writeoff?

@Zhenyang JinIf your LLC includes you and your business partner, yes you should file a 1065 partnership tax return.

Inheriting it is the best option tax wise- because it gives you a step up in basis to the property's value on that date. 

GEt some Credit Cards, spend a little every month and pay off, then get higher limits and repeat.

I have a capital gain taxes question:if I sell my home for 510k and provide the seller 10k seller credit towards escrow costs, would I be paying capital gains taxes in California for that additional 10k?

If the OP doesn't pay the taxes then the property will go to tax sale again and he will be wiped out.

Your not correct under many different circumstances.First property tax is 1.1% (fairly safe) with 2% annual increase (prop 13).Next expenses include a lot more than property tax and interest. 

Real estate syndications provide a hands-off approach to investing and can diversify your portfolio, but they primarily generate passive income rather than tax advantages in your situation.

The information shared is based on my experience and industry knowledge and should not be considered tax, legal, or financial advice.

This means the rental rates are average nothing to write home about, but the increase you'll get in appreciation is amazing, but not liquid until you sell.