@Chris RandInvestors who have rental properties report their rental activities on schedule E.You report rental income less expenses(insurance, utilities, repairs, mortgage interest, real estate taxes, depreciation etc).The great thing about real estate is that you may have a cash-flow positive business but report a taxable loss thanks to depreciation.The difference between cash-flow and taxable rental income is that depreciation is factored into taxable rental income and principal payments are not a tax deduction.generally speaking cash flow - depreciation + principal payments = taxable rental income

Same goes to the lots not currently being utilized and reaching out to the state.I have decided to reach out to the owner and speak with him on some of the concerns. 

In addition to what's already said above, Of course do your due diligence from ensuring proper leases are in place, the rent he says is what he gets by checking his bank account or some sort of proof, make sure the expenses he quoted are correct by looking at utility bills etc., title should be free & clear, no zoning violations etc.

Ultimately, our goal is to utilize the BRRRR  method but that would be years down the road when we can bring more cash to the table. 

All the best to you and others in the STR industry.

The year's total rents was about $23,000 with approximately 75% of that going to the mortgage/utilities/management fees.

I can foresee adding 2-3 properties between now and then (potentially more bringing in my design build friend as a partner) with the goal of moving more fully into this as a line of work with a focus on bringing hospitality to the rental industry.  

Accordingly, I don't utilize LLCs, and for me I have concluded they really weren't necessary to begin with (just a lot of extra costs and headaches).

The land and all the improvements to the land such as utilities, streets, etc.

But as I've worked in the industry, I've realized that companies do not value knowledge or experience.