The conversion amount will be considered taxable income and you'll have to pay taxes on it.

As much as you can handle in pre-tax accounts, but make sure you are saving money in a taxable account for RE investing purposes.

From an attorney point of view, you need a CPA that can answer questions about limiting your tax liability or taxable events as your grow your business.

The only option would be to take taxable distributions from the IRA.IRS rules prohibit any self-dealing or personal benefit from the IRA.

@Donovan LietchWhatever the investor receives over and above his $10k investment is taxable income to him (and also a deductible expense to you.)Seeing how little you know at this point about recruiting investors, I highly recommend you don't try it on your own.

If so, the $180k gain wouldn't be taxable. 

Alternatively those funds can be rolled over into self-directed IRA (this would not be taxable event) and in turn purchase vacation rental or any other alternative investment. 

Is this accurate:(NOI - Mortgage Interest - Depreciation) * Tax rateWhich equals your taxable rental income.Subtract that from your cash flow before taxes (CFBT) to find your cash flow after taxes (CFAT).Is that right or did I miss something?

If I have a negative cashflow on paper or IRL this year, will I decrease my taxable income from my full time job?

Much of the frustration with "banks" come from their having to comply with "Dodd Frank" legislation that doesn't recognize depreciation as simple accounting and only looks at the taxable income, not the free cash flow, on a property.