Great response and i'm very happy that my first post has received such a knowledgeable veterans inputTo answer your last question of would it be really shady that it's so far below market - what i'm noticing is that they are giving me pro forma numbers (best case scenario) to make the place look like a good deal, and my concern is that if the rents were too far below that, there may be a reason that they are hiding for it.

One possible structure would be for the LPs to receive a preferred return, and then any residual profits would be split between the GP (you) and the LPs. 

Received a $1M offer on a 16 unit building that I purchased back in March - leaving me with a nice profit.However, I am expecting 30% in short term capital gains between the state and federal and a prepayment penalty of $6000.00.Thus, unless I can 1031 into another deal...this transaction may be tough to put together.Any ideas on how I should source deals and find a way to defer my taxes?

What documents can i expect to receive before I agree and pay my deposit to them?

@Adam YetterI would say if your partner is strictly passive he should receive between 50-75% of cash flow and equity..

Everything went smooth with the purchase and initial property turn over until I received a letter from the HOA management stating they knew that I was going to rent the property and that I had to wait a year before doing so.I was surprised by this requirement.

The seller has an on-site property manager in place receiving free rent for one unit + $1000/mo salary + another unit as an office.

He’s received two full price offers and hasn’t accepted because he wasn’t comfortable.

After receiving the deed I was going to first talk to the association office and gather any info from them about the property and if they think anyone is living in the property.  

All the assistance programs require the landlord to complete a W-9 and receive a 1099 though.