A simple LocalScript that will hide the player's character when they zoom into the current CameraSubject if it isn't a humanoid.

CameraSubjectLocalTransparency.lua

--CameraSubjectLocalTransparency
--by @mvyasu

local HIDE_CHARACTER_WHEN_DISTANCE_IS_LESS_THAN = 5

local SHOULD_TWEEN_TRANSPARENCY = false
local TRANSPARENCY_TWEEN_INFO = TweenInfo.new(1)

local TweenService = game:GetService("TweenService")

local player = game.Players.LocalPlayer
local camera = workspace.CurrentCamera

local activeConnections = {}
local function cleanupConnections()
	local connectionsToCleanup = table.clone(activeConnections)
	table.clear(activeConnections)
	for _,connection in connectionsToCleanup do
		connection:Disconnect()
	end
end

local function addConnection(connection: RBXScriptConnection)
	table.insert(activeConnections, connection)
end

local function setupCharacter(character)	
	local wasHiddenLastUpdate = nil
	local function shouldBeHidden(): boolean
		if camera.CameraType==Enum.CameraType.Scriptable then
			return false
		end
		local cameraSubject = camera.CameraSubject
		if cameraSubject then
			if cameraSubject:IsA("Humanoid") then
				return false
			end
			
			local subjectPosition = cameraSubject:GetPivot().Position
			local cameraPosition = camera.CFrame.Position
			return (subjectPosition-cameraPosition).Magnitude < HIDE_CHARACTER_WHEN_DISTANCE_IS_LESS_THAN
		end
		return false
	end

	local function setDescendantTransparency(object, forcedTransparency: number?)
		if object:IsA("BasePart") or object:IsA("Decal") then
			local newTransparency = forcedTransparency or (if wasHiddenLastUpdate then 1 else 0)
			if SHOULD_TWEEN_TRANSPARENCY then
				TweenService:Create(object, TRANSPARENCY_TWEEN_INFO, {LocalTransparencyModifier = newTransparency}):Play()
			else
				object.LocalTransparencyModifier = newTransparency
			end
		end
	end

	local function setCharacterTransparency()
		for _,descendant in character:GetDescendants() do
			setDescendantTransparency(descendant)
		end
	end

	local function updateCharacterTransparency()
		local shouldHideCharacter = shouldBeHidden()
		if shouldHideCharacter==wasHiddenLastUpdate then
			return
		end

		wasHiddenLastUpdate = shouldHideCharacter
		setCharacterTransparency()
	end

	updateCharacterTransparency()
	
	cleanupConnections()
	addConnection(camera.Changed:Connect(updateCharacterTransparency))
	addConnection(character.DescendantAdded:Connect(setDescendantTransparency))
	addConnection(character.DescendantRemoving:Connect(function(descendant)
		setDescendantTransparency(descendant, 0)
	end))
end

player.CharacterAdded:Connect(setupCharacter)
if player.Character then
	task.spawn(setupCharacter, player.Character)
end