I want to start investing into section 8 housing, and I have heard a lot when it comes to cost segregation and the effect that it can have on one's taxes throughout the year. 

My degree may not be my passion, but I know it will provide an income that I can leverage into something else (I've already started working).Currently, I am living in a home owned by a relative, and my rent is impressively discounted.

My wife and I are looking to invest out of state and we've started looking into the Huntsville Alabama market. 

We've primarily been focusing on building relationships with brokers, bankers, etc. but I feel like we need to take additional action and dive into the direct-to-seller realm. 

Best thing to do with subject to is to have the seller transfer ownership into a land trust where you are the beneficiary of the land trust.

This presumes you make smart purchases that cash flow after paying all their expenses (Principle, interest, Taxes, Insurance, and a maintenance / Capex reserves).The risk of leverage is if your properties AREN'T making money - maybe you misjudged your income, or you run into repairs that cost more than you expected or budgeted for.  

And that doesn’t take into consideration the $400K.

Unfortunately, your accountant is right about this one.In a 1031 exchange, the goal is to roll over all the proceeds into the new property to defer the capital gains tax.

I will take your points into consideration.

I think it's smart to put money into the stock market.