Since you are going new construction, the difference in cost between 2bed and 3bed is not that much and the ability to get tenants for 3 bed is much easier and therefore more income capability.  

2) We want all of this classified as passive income (and will for instance have a property manager), so I believe would want this classified as an LLC, with the investors listed as the owners.  

I have asked for a cosigner who currently has the adequate income to make the rental payment and a good credit score. 

I am self-employed and take out large deductions, so using returns for income verification is a problem.Do I have any options to pull out equity from these properties, or do I have to turn to hard money to fund this flip?

As a successful investor and business owner, I felt like I had enough active and passive income and cash reserves to start having a little fun.  

I do have lawyers I do have credentials I'm not a shade tree "Carpenter" I have a family & so does the guys who works with me or for me, want a continuous income.

What to do with 1099 income (don't need to it for living expenses) given that I am looking to invest in a property?

You can then rent out your condo on VRBO or AirBNB while you're not home and have the property earn income for you. 

My short term plan is focus on buy and hold until I have replaced my I.T. income.  

I’m looking to real estate to secure my retirement and augment my income with hopes that I can build a business to pass on to my children someday.I’m very interested in growing my network around the Denver and Front Range area and would love start getting involved in some of the meet-ups in the area.