Since you own the LLC / Land Trust, provided the activities you performed to earn material participation hours meet IRS requirements and the STR meets IRS requirements, then you should be able to offset non-passive income (W-2, 1099, etc.) with losses from this STR. ...

My current strategy is to maximise equity over cash. 

Find out what margin you want to earn, and make that your number. 70% is common...however, not for everyone or every deal.

Even with conventional loans, unless you've been self-employed less than two years or don't report your income, it's the same as someone with W-2 employment We lenders just cash-flow you differently.

Purchase price: $650,000 Cash invested: $65,000 STR in Black Hawk CO

I need to double check, but I believe TN is in the 13% range with state and local.Then several areas basically tripled property taxes practically overnight in a massive cash grab.

Other option would be her doing a cash out refinance on her home and using that money to purchase with cash.  

Purchase price: $800,000 Cash invested: $80,000 Primary residence with an ADU What made you interested in investing in this type of deal?

Also know that the housing market might not go up as quickly as you like...but honestly as long as it cash flows when you move out that is okay...I recommend saving up at least 6 months' worth of rents and having it cash flow at least $300 a month before moving out of the property.

Purchase price: $999,950 Cash invested: $2,000 Our Good Neighbor Realty Office in Denver!