@Otis Clayton To partner in real estate effectively, establish a clear structure like an LLC for liability protection or a Joint Venture for single projects.

It’s incredible to see how these investments are paying off, and I’m on track to hit the six-figure mark in revenue by the end of the year (With just the two airbnbs I was already on track to hit that figure, the third Airbnb will definitely help haha!).

At that price point, your renter pool is incredibly small.

Their personal problem does not effect your contract in any way.

Absolutely incredible in-depth information from an expert in the field!

Also, your total returns go down without any leverage because you lose the multiplier effect of appreciation.Now, to answer your question.

Net effect, typically, means distributions are not taxed in current year, but do lower your basis resulting in larger tax bill upon sale.Depreciation reflected in the net gain/loss from rental box on K-1.  

I would be incredibly grateful for any advice or insights on building a solid digital structure for a small business like ours.

What makes it slow in this case is that you don't really start seeing real cash flow until after year five but it's more effective than rentals in that there is little to no maintenance.Sure you can live in a home while fixing it up with the intention of selling it for a nice profit later but I think many people are already doing that and the buyers of slow flips now also have that opportunity without having to qualify with a bank.

I never had that come into effect on my single family home purchases since I never wanted to personally be on the hook for such a high mortgage, but I think it might come into play for an MFH.