The floors had a darker stain on them which is showing signs of wear/tear/scratches.

I'm sure if you were to ask most investors at which point in the investment property lifecycle they break-even and truly start cash-flowing they either haven't figured that out or don't know how to calculate that number or what the true IRR on a property is going to be because they think once they close escrow with 20% down they are cash-flowing on day 1.When @Chris Seveney talks about the IRR for a long term buy-and-hold, I factor in a rehab at year 15 of a 30 year hold, whether it's due to wear and tear, or possible change in interior styles to remain competitive in the market.

Dear Friends,  When I did tenant move out walkthrough, there is an area of bedroom carpet damaged by the tenant, not normal wear and tear.

Did you do a tear off of the old?

Also consider increased wear and tear, eg on plumbing with all the extra laundry/washing/little kid bladders etc. 

We have used Elite Roofing before- very good price, but I just discovered that a roof they did that was supposed to have been a tear-off was not.

Most lay people don't know what to look for, or what is damage vs. normal wear and tear, or how to interface with the tenant. 

Tenants really tear up a place.That being said, you should use a lawyer local to the property if you can.

Deduct for any damages (outside wear and tear) and return the security deposit.

The third option, I stay in my house an hour away from work and continue to pay 400 bucks in gas and wear and tear on the car.