Also, focus on 2 years of job/income stability.Class D Properties:Cashflow vs Appreciation: Typically, all cashflow with little, maybe even negative, relative rent & value appreciationVacancy Est: 20%+ should be used to cover nonpayment, evictions & damages.Tenant Pool: majority will have FICO scores under 560 (almost 30% probability of default), little to no good tradelines, lots of collections & chargeoffs, recent evictions.

@Brad Kanouse Using Traditional IRA funds for an investment property typically incurs income tax and a 10% penalty if you’re under 59½, as investment properties don’t qualify for tax exemptions.

This will not qualify for 1031 Exchange treatment under the present structure and "use." 

This is a complicated situation with multiple layers to consider, so here’s my take based on your questions:If you’re looking to move assets from the partnership into individual LP (Limited Partner) names while avoiding capital gains, you’ll need a strategy that complies with tax regulations.

So far the biggest challenges for out of state investments has been finding reliable contractors or help to complete projects on time and under budget.

I've never spent money on inspections/environmental before having the property under contract.

The cloak themselves under the veil of God and country and it's all part of their marketing scheme.

With such a competitive Dallas market, getting any house under 200k that's not in a rough area looks impossible.

I simply know where to find the nuts; under the tree of course.

This is most of the depreciation you are taking year one.You can calculate your depreciation recapture by taking the sale price of the asset and subtracting the adjusted cost basis.The adjusted cost basis is what you paid for the asset plus any improvements you made along the way minus the depreciation you took along the way.The profit above this original cost is taxed as a capital gain, but the part linked to depreciation is taxed at a maximum rate of 25% under the unrecaptured gains of section 1250.To recap the tax rates are:- Sec. 1250 real property: 25%- Sec. 1245 property and 15 year 1250 property: Ordinary Tax RatesThere are ways to minimize depreciation recapture especially if you know how to work smart with your CPA.1) Asset Valuation at Time of Sale - Sellers can minimize recapture by reallocating the price of the assets on sale.