The house would be considered a capital asset, so to be conservative, I would estimate 20% of the gain for tax, plus an additional 3.8% for the net investment income tax if your total adjusted gross income (worldwide) is over 250k.

How accurate are those estimates ?

Once the rental home is sold, my half of the proceeds will be roughly $113,000 (this is after closing costs and taxes and is an estimation based on the current market value). 

If using realistic expense estimates (such as the50% rule), this negative equity can take years to recover.  

Re knowing the market, which is one of the reasons (I've read up on that) you'd want a RE agent, esp if not from the area, which I am not, my agent is from about 2 hours away and as the listing is an existing Airbnb for 3 years, I see the prior numbers, and based on that, reviews, and market data, have made an estimate of what I believe it will make under my ownership.

Our estimated ARV will be ~$850k.

AirDNA, Rabbu, Pricelabs all have estimator tools.

Now, I need to renovate the estimate (40k-50k loan) to get 260-275K ARV.

I estimate that the expenses should be around 900 a month (Not including the mortgage).

Some people even write in estimated cap ex in the calculation.