., Each of those LLCs are different tax payers owning different properties. 

In others, you're buying the tax receivable for a certain year; you pay the taxes to the city/county in place of the taxpayer, and now the taxpayer owes you instead of the gov't.

Once a taxpayer meets the REP status, do they need to materially participate in each property?

Hey Marc, Claiming Real Estate Professional Status (REPS) for a taxpayer (TP) who is a W-2 employee and involved in asset management is indeed challenging.

To qualify as a real estate professional, a taxpayer must meet both of the following criteria:Taxpayers perform more than 50% of services in real property trades or businesses in which they materially participate.

When a building is sold, the taxpayer or the seller must recapture depreciation previously taken on tangible personal property.  

Lastly, the safe harbor for small taxpayers allows you to deduct expenses under a threshold of 2% of the adjusted basis of the property up to 10k. 

However, the exact treatment may depend on your accounting method (cash vs. accrual basis), but most individual taxpayers use the cash method, meaning they typically report expenses when paid.

Advantages are that you only need to form and pay for the initial series LLC, file one franchise tax report, file one tax return, and pay one franchise tax payment if required by the state the LLC was formed in. 4.

In connection with its duties, Qualified Intermediary shall be protected for acting or refraining from acting upon any written notice, request, consent, certificate, order, affidavit, letter, facsimile, email or other communication or document furnished to it under this Agreement and to have been signed or sent by Exchanger or any of its officers, attorneys, or other representatives, provided, however, that any instructions relating to disbursements of funds shall be subject to the provisions of Section 3.4 above and the Disbursement Instructions shall be signed by the taxpayer or submitted by the taxpayer online via the Software."