It usually appreciates slowly, and the profit will be taxed at capital gains rate, which can be addressed with a 1031 exchange, outside SDIRA. 

Instead, you have to wait a few years to return your capital through the cash flow. 

@Steve Vaughan  I think the reason they do is for some reason they believe what they hear that the way to buy rental real estate when you have no money.. is to wholesale first get some money then buy rentals.when in fact wholesaling or buying and selling deals quickly in any volume takes a lot of skill.. significant marketing capital.. and most of the time they are breaking the real estate laws.And you have all sorts of HOW TO trainers selling their boot camps and of course they lead with you too can get rich with NON of your own money..theoreticaly that's true.. but not really reality in the real world..not to mention some areas simply do not have enough distressed real estate to make it viable at all.other areas like urban cores and cities that have seen hard times much easier to at least snag low value assets no one wants.. much of this is done is rough areas.Granted there are always hoarder houses and other fixer types in the nicer areas but its uber competitive for them.. and generally there is not enough profit in them to feed all the mouths.the wholesaler the buyer the buyer having to use hard money the contractor sales cost etc.. that in my mind is why you see so many post about HEY wholesalers don't know what they are doing..

Does anyone have any advice on setting up a trust to reserve capital versus conducting a 1031 exchange?

You really need to look at capital expenditures.

Based on what you've described it sounds like you will have to capitalize your 2017 expenses to the basis of your property. 

I am trying to learn more about tax liens here in Franklin County but not sure if that is the way to go (the process seems like it is geared toward those that have the capital to buy up bundles).I recently heard a pocast about BRRRR on BP and it sounded like a good strategy for the central Ohio area.  

@David Huynh Generally, expenses incurred to facilitate the purchase of real property are capitalized to the basis of that property. 

Long term I'd like to buy and hold rental properties and as my capital base expands I'd like to get into commercial properties. 

What route do you think makes more sense to bring together private capital for flips?