One of the major reasons we got started over a decade ago. 

Im a fix n flipper, and this is my first year reporting income from the business to the tax man and I don't want my taxes to have been reported incorrectly for fear of future issues should they arise. 

This can be particularly appealing if the seller is facing financial difficulties, needs to move quickly (perhaps due to relocation, divorce, or other personal issues), or the property has little to no equity and they can't afford to sell it through traditional means without bringing money to the closing.

Not to get off topic, so I'll say it this way, a HML needs to realize that there are two issues behind the regs, your competetion and consumer protection issues.

I have the money saved for the rehab but I would apply for a loan to cover the majority of the rehab and use savings for future repairs. 

And while she may save 15% long term capital gains tax, it will probably still cost 7% - 8% in selling expenses - real estate commission is the majority, but most people overlook pesky little things like transfer tax, holding cost after tenant has moved out, maybe some repairs etc.

We want to stay compliant with any IRS issues and work within the newly created multi-member LLC.

He might  consider  selling to you and saving some funds in his  bank and  using a reverse mortgage to  purchase the proeprty .   2)  for your side -if you need to keep the down payment low - using the  VA loan is a great idea ...already having a VA loan outstanding you might have an issue  using another VA loan . 

These are supposed to majorly drag down a properties value, but this is my 2nd highest priced comp on price per sq ft.

This shouldn't be an issue for most DSCR lenders.