I can have parents visiting me and living on 2FL) or leave it empty, would I be able to exclude all the profit from capital gains tax if it's within the limit (250,000)? 

Currently limited market & properties, but interesting concept as they expand.

However, this is highly audited area and you will see some blocks:1) you need to find a right asset first that you  enough depreciation with cost seg. 2) you need to materially participate in that activity.3) your losses might even be limited based other IRS code section. 4) You need to have an audit proof and documentation of real estate professional status.If we are talking about a huge tax bill, I’m pretty sure you would benefit from hiring a good CPA who can cut your tax bill.

Youll find some in Takoma Park (rent control in the city limits so be aware of that) then in DC proper.

AdamIf your losses are not otherwise limited, you don't have to carry over the losses.

SEC placed limits on how much sophisticated investors can invest in the recent upgrade to the law.

@Greyden PiechnickYour mom's CPA/accountant is not explaining it correctly or not doing her return correctly.She is  eligible to write off real estate related expenses on her return regardless of her(including stepdad's) income including depreciation.There are some limitations when the income level is above $100,000 / $150,000.

Which may also include, but not be limited to: Escrow Agreements, Truth In Lending disclosures, Assignment of Rents, Anti-Coercion notices, etc, etc.

I'd recommend that you help others that are looking in cheaper markets with their flips and ask to join them with the limited capital you have.

Fannie Mae and Freddie recently limited 7% of their portfolio to be investment/second homes so this has caused rates to increase for Conventional investment properties.