STR Joint Venture - need advise on LLC Setup and material participation

Purchasing an STR in AZ. Myself a resident of NJ. This STR will be a JV in between myself and a friend who will contribute some capital , have preferred returns, some equity, will help somewhat in the whole ordeal - acquisition, setup and operations just to fulfill his 100hrs to get depreciation. I will be doing rest of the work.

Need advise on where the LLC should be setup - in AZ or NJ is fine? Any recommendations for attorneys who could help setup such a JV deal at a reasonable price?

Would there be a challenge in both of us claiming 100hrs of material participation? I do have other STR’s through which I am easily able to show approx 500hrs or maybe even REPS this year (w/ 750hrs).

Thanks

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