San Diego investors -- I'm currently working on my first home renovation, employing a live-in flip or long term flip.

I'm self employed you just have to eat paying more in taxes or make more lol.

We have a few retired military friends who have moved dozens of times in their career and employed a strategy such as the one above.

Flipping would increase your taxes because you have new self-employment taxes to pay, if you didn't use some tax mitigation strategy.Big picture observation: your taxes shouldn’t have increased just because you bought these rentals (unless these rentals gave you huge positive cash flow even after depreciation during the first year). 

I take it that means you're self employed?

As part of its price stability mandate, the Fed considers 2% to be healthy, though it is committed to letting the level average higher than usual in the interest of promoting full employment.

The strategy I would love to adapt is a 'buy & hold' strategy, because I believe that buying and holding income-generating assests like rental properties is one of the best ways to build weatlth over the long term.The main question of my post concerns defining my own market.

None of my generation at that time knew that was coming.

I don't know how they hold the deed.The questions:  What would be the easiest way to transfer to the next generation? 

. $50k K1 loss3. no tax on distribution during the entire 5 years because of $50k loss.4. at the time of sales, you still have $20k loss left5. at the sales (~2.5 times multiple), you get ~$200k back ($100k original capital + ~$100k profit).6. you owe IRS capital gain for $80k + recapture of depreciation, depending on your income, up to 20%.If you don't do anything, then you pay IRS long-term capital gains tax and it's all done.However, if you invest all the proceed of $200k in the same calendar year on a deal with the same terms, then you generate $100k paper loss effectively offsetting capital gains tax from the first deal.It seems like you will eventually run out of paper loss unless you put additional money in. however, you can defer the tax quite a bit.You can continue to do this until you die.... when you go, your kids will get this tax-deferred investment on a stepped-up basis wiping out the tax liability.Am I understanding it correctly?