Trying to decide if we should use a home equity loan for the remodel, do we need to put current home under LLC to help with debt to income ratio & would that affect getting the home equity loan?

Let’s break this down because there’s a lot to unpack here.The real question is, how well is that debt working for you?

I would warn you though as soon as you give an inch, the next month if rent is not paid on time you may have opened up a door of forgiveness that was not intentional.

The owner does not want to extend the debt for 30 years.

Eliminate debt, establish a budget, and save.

And how much is your debt service, around $6,500? 

The bank will make you leave 25% equity in the property - but you also still want the property to at least cash flow some - so be careful how much equity you pull out / new debt you take on.I would do a cost benefit analysis of what your actual gain is in cash-flow on buying a new property with a (currently) higher interest rate (if financing), versus just holding on to the current appreciated property and enjoying that cash flow.All the best!

Taxes : Taxes have been a brewing crisis nationwide for sometime, Chicago is another prime example of a major municipality struggling under high debt load.

Would a cash-out refinance to free up equity and keep growing be a smart move, or should I focus on paying down my existing debts?

While I do maintain a relatively modest percentage of my assets in money market instruments, corporate debt funds, and high dividend stocks, I remain most comfortable with the investments I specialize in and know best.