I agree with @Funsho Adesanya You really do need a well thought out operating agreement if you are going to have an LLC with anyone other than your spouse.

On average, 20% to 40% of those components fall into tax categories that can be written off much quicker than the building structure.A Cost Segregation study dissects the construction cost or purchase price of the property that would otherwise be depreciated over 27.5 or 39 years.

First thing to do, if you haven't, is to hyper-focus on your finances and savings so you can be fully prepared when the time comes.

@Nick Filippides, You can do a 1031 exchange on that property since it is being used for investment. 

It will take a huge amount of work to upgrade the property which has not been properly maintained, so we'll be doing a lot of infrastructure rehab including adding HVAC/AC, upgrading the wiring, and bringing the old floors back to life.

I estimate that will take about 8-10 months to get where I want to be. 

He let me know that he didn't "think" the seller would be interested in financing and it hasn't sold because the owner wants full asking price ($330k). 

Even if you create a non-CA LLC, if you are managing the business from California, you will likely be deemed to be "doing business" in California and therefore likely subject to CA taxes.

This was going to be my best year. 

Your lender should be well aware of this....it sounds like they likely didn’t do the DU step