You want to buy any new properties in a LLC but also depending on how much you want to scale your real estate biz, you may want to create a holding company LLC and a S-Corp if you get large enough.

Moving forward--have full photo documentation of the damages and estimates to repair, and have the manager tell the tenants if they cannot pay in full or with weekly payments, (scheduled to be paid off in full BEFORE the last month of the lease) the management company will move forward with legal action.  

Just keep track of all your costs, expenses, etc and at tax reporting time enter all the information.I found it invaluable as a tool to learn more about tax law and play with "what-if" scenarios.

So when you sell the asset, that payoff is in the loan file and title company knows to pay that off and pay you the gravy. 

Is there a home warranty company you recommend? 

When you walk down the soda aisle of your local grocery chain, you think there's a zillion choices, bunch of companies all making cola and variations there of, but no, it is an illusion. 

Not exactly sure how this would work to make sure we are taking advantage of the loss reported for our own personal taxes.

You can find a company that doesn't have a high spend/volume requirement and flexible pricing options based on your needs.

During the inesption, it was found a drain snake was broken off in the sewer piping and the tenants reported previous backups. 

Our internal team is there to help you review rehab bids, inspection reports, analyze different exit strategies based on your updated numbers throughout the project, and help you work with different lenders and insurance agents that we refer you to.