I didn't read this to ensure its accuracy but it certainly looks to be from a credible source. https://www.irs.gov/pub/irs-utl/33-Real%20Estate%2...Cliff Notes:Real Estate Professional Qualification • Material participation in each specific rental • Material participation in separate Real Property Trade or business • 50% rule • 750 hours rule • 5% ownership ruleReal Estate Trade or Business Defined IRC Sec. 469(c)(7)(C) Any Real Property: • Development or redevelopment; • Construction or reconstruction; • Acquisition and/or conversion; • Rental Activity that is not a Passive Activity; • Property management; • Brokerage activities.Example 1: Laura owns 5% or more of a real estate sales office • Works full time as a broker • She owns 3 rental properties and: • She finds the tenants; • Approves tenants and leases; • Approves and oversees repairs & improvements • Net rental losses are $31,000 and her modified AGI is $160,000 before the losses • Deduct the full $31,000 in the current tax yearExample 2: John acquires old homes and contracts 3rd parties to renovate and ready for resale.

Only, I want to make sure that the infrastructure is in place to be able to handle that kind of volume.I actually do work with some high net worth W-2 earners, surgeons, MD's and such so I see the potential of the future to make some moves but the question is "how" do I get there. 

Kind of like a PCP and a surgeon.

I would read that town ordinance and call the rent control board. if they are behind on rent and also you do major reconstruction you should have some out.

A license is a license, it isn't like hiring a brain surgeon who went to Harvard vs community college. 

Allow me to put emphasis on estate planning attorney, just as your real estate attorney specializes in real estate and a brain surgeon specializes in brain surgery so does an estate planning attorney specialize in estate planning.So, what happens to your real estate properties if you died?

The idea would be for the tenants to pay for the Reconstruction so I don't need to go to the bank and pay for it out of my own pocket just to get it back when I sell it .  

Replacement Cost values themselves are derived using appraisal software by your Agent and the Insurance Company, or an appraiser, but they are not market value estimates, they are reconstruction cost estimates.

Apply the same ratio to the current value of the house to reconstruct a reasonable basis.

So the property owner would be compensate 300K in actual cash....if you'll notice our client would have been out of pocket for 200K after getting their payment and then paying for the re-design and the reconstruction needed.I tell you that to say that our client's attorney argued the point, provided case law, and (I believe) had their own appraisal to demonstrate a value that was more in line with what they considered fair.