I’m all for minimizing taxes paid but I have also seen lots of people get themselves all “balled up” in complicated structures that can cause problems down the road.I can tell you as a single man I sold my house in San Carlos CA back in 2014 so I only got $250,000 tax exempt.

In practice, most syndicators won’t do this because it complicates their fee and profit structures.

It gets a little complicated so I'll try to make sense.

And HELOCs really aren’t too complicated.

People are making this way too complicated.  

Unfortunately I don't live in Oklahoma but rather in Florida, so that complicates things a bit. 

Brief attorney consultations are $50 to $300 around here, and this seems like a complicated high-fee problem.

I’m following up on Stephen’s advice and want to share our plan in a clearer way:Our Plan: Form a 50/50 Family Holding LLC owned equally by my mom (Sarah) and me (Jay).Set up two new single-purpose LLCs under the Holding Co.Transfer our four existing rentals into those two LLCs (two properties each).Leverage equity in those LLC-held properties to fund down payments on two more rentals.Example:We have one property worth $300K with no debt.We do a 70% LTV cash-out refinance → $210K in our Holding LLC bank account.We use that $210K to fund 20% down on roughly $1M worth of new rentals.Why we’re doing this:Scale faster by pooling equity and borrowing against the entire portfolio.Maximize tax benefits through pass-through deductions and accelerated depreciation.Protect assets with clear LLC liability shields around each property.We’re looking for:Feedback—Does this structure make sense, or are we over-complicating things?

The media will not be covering this sine it does not make a good sound bite and it is a complicated idea.I do see better days ahead.    

Here’s an excerpt (see below) from the IRS Audit Technique Passive Activity Guide on this rule, which covers more than just the 100 hours.