I was by default going to set up a Florida based LLC with my partner.This is a buy and hold, rental income property.How would you go about setting up an entity out of state?  

I challenge you to find a single reputable source that shows San Diego residential RE has not produced outstanding ROI.  

I am trying  to purchase a multifamily house , outside of the city where i live it wis about 150  miles from my location ,  how do i figure out the demographics of the area and also the medium income around the area where i am planning to purchase . do i need to look for any big stores/shopping malls or any govt offices around the area to see if the place would be ideal for purchasing the property for renting it .

I am able to work as a travel doc, and she works remotely in tech, and we plan to use our combined incomes to put towards REI, as well as keeping our cost of living reasonable!

Several of my recent buyers have been medical and legal professionals with high taxable income, that are looking to expand their value portfolios by incorporating an accessible short term rental property (often doubled as a legacy anchor) that will often offset or 'pay for itself,' in tax savings. 

Your greatest challenge is going to be running this management company without the appearance of co-mingling all of the LLCs together.Bear in mind that one of the things that you'll be doing here is converting Passive Income to Earned Income via the Mgmt Company and that will be subject to self employment tax whereas had you left everything in the property LLCs, you'd have only passive income. 

A leak, a drip, where is the excess moisture coming from and deal with that source (if any). 

If you want true "Passive" income in real estate, you need to have a lot of cash to put into it.

I have a tax question regarding how to report my rental income when my tenant made and paid for improvements and I am reimbursing them by lowering their monthly rent. 

The loan programs for 1-4 units have more favorable terms depending on if you're buying with income with a conventional investment property loan or having the loan underwritten by the rents with a DSCR / rental property loan. 5-8 loans generally have tougher underwriting and the rates are higher if you're looking at DSCR loan options for 5-8 units.