Thus conveying any 1 said property to a specific person/entity for utilization but retaining asset in a trust for various factors. 

While not in TN specifically, I have assisted clients do as you have described: live in a property as a principal residence for 2 years, rent it out for 3 years, then sell.Based on the situation described, you would appear to be eligible for the MFJ joint exclusion on principle residence on your 90% share.However, in order to retain that ability, the house will very likely need to be sold (ie, sale closed, not just under contract) by the end of this month. 

Nice try though.Myth 4: I'm hands-on, so I materially participate"Material participation" is defined by the IRS, not by your Facebook friends and not by YouTube gurus.

There are multiple ways to qualify for "material participation" but this would help to keep someone else under 100 hours. 

Do you want to bring in an equity partner to fund the house build to rent out and you retain some equity?

Spend more than half of your total working hours in an RE business in which you materially participate.2.

Know the prices of your trades, know your material costs, know your end sales prices. 

Potential hangups with materials?

What you may save in material you will make up for in engineering and architecture fees. 

Two coats of paint including ceilings and trim for a 1200 sqft. house in our market is at least $5k including materials.