Not even sure where you are pulling 30% from...Taking money from a traditional retirement account(non-Roth) now or later is subject to income tax at your marginal income tax bracket.Any 'planning' around distributions that you can do later can also be done now.If you want to take money out in a year where you are in a lower tax bracket(result of going back to school, taking a year off from work to travel, a year where you have a lot of losses from real estate via Real Estate Professional Status, etc).Also, hard to say what your income / tax rates will be when you retire.

Honestly, we should have been easy clients - we came to him with a plan in place wanting his help on claiming REP status, setting up a cost segregation for a rental property bought and functioning in 2022, so that we could file for 100% bonus depreciation for that tax year.

@Harjot Khangura @Eamonn McElroyIf he files jointly with his wife and his wife does the 750 hours/year required for the Real Estate Professional tax status that would be legal and the unlimited depreciation defensible, right?

Could an applicant claim that you rejected them based on protected status?

The second is where I find myself as someone who has always been an achiever I am not satisfied with the status quo.

@Kevin Si as others mentioned, it depends on a million different factors specific to the investor (such as their current cashflow, future cashflow needs, current debts, net worth, other investments, their level of experience in REI, whether they have a w2, their tax situation, how much risk they can tolerate, how active/passive they need to be in the investing strategy, their health status, whether they have dependents, what type of lifestyle they want to have in retirement, etc., etc., etc.). ...A great strategy for one investor might be a terrible strategy for another investor, depending on these types of factors...You mentioned the option of buying a single property that would cashflow $65k/yr...for some folks, $65k/yr is more than enough to live the lifestyle they want, and for others, $65k/yr would be a drop in the ocean...Another consideration: let's say they buy that property that cashflows $65k/yr.

Honestly, we should have been easy clients - we came to him with a plan in place wanting his help on claiming REP status, setting up a cost segregation for a rental property bought and functioning in 2022, so that we could file for 100% bonus depreciation for that tax year.

change the qualification status and allow this strategy?  

You can request a payment hearing where the court evaluates the status of the payments.

Can't tell if that's worth it, although with today's rates, might just be the status quo.