The determination of what qualifies for Real Estate Professional Status (REPS) hours can be complex, and it's essential to consult with a tax professional or CPA who specializes in real estate taxation for specific guidance tailored to your situation.

Adam could elect to have his LLC treated as a corporation for tax purposes, but that just brings double taxation issues into play for any "dividends" or capital gains distributed by the LLC, and, denies Adam use of the net passive loss allowance should his rental activity have a tax loss.

And you should not pay transfer tax at assignment no matter who is transferring (LLC or a person). 

It makes no difference if flipping is your regular job or not, anybody who buys a home with the intent to fix and resale it is subject to income tax at their ordinary rate, it is never taxed as capital gains.

If you ONLY sell props via 1031 exchanges, then leave your final props to your heirs, you avoid taxation entirely in your lifetime.

@Doug Maye, My wife and I are sitting with another accountant Tuesday to discuss this exact topic.... from the business/taxation side.

I recommend finding an accountant that specializes in real estate taxation.

I recommend that you hire a tax accountant that specializes in real estate taxation to assist you with tax return prepartion. 

A good accountant that specializes in real estate taxation is worth their cost.

This is separate from taxation, though...Hope this helps :)