We are pet friendly and have some zeroscape backyards and have wording like "We are pet friendly with a fee, but please note although backyard is fenced there is no grass and certain areas contain crushed shell which could hurt your pets feet". 

Quote from @Brandon Leffler:I may sell my condos in CA as the HoA's have climbed to 400$/mo I wouldn't sell your condos solely based on HOA fees being $400/mo.

How do we minimize taxes on the profit we're making on this first home? 

But what I would point out to you is that the typical fee for property management is 8-10% of GROSS rent.

The interest would be tax deductible due to interest tracing rules. 

There may be something called a "Due On Sale" clause.Check and see if all tax parcels are included in one mortgage or if they have separate mortgages.You have to have him spell out what he considers to be a "partial seller financing".

I"m also seeing people doing STRs to get the tax benefits besides the higher cash flow. 

How would this be accounted for for general accounting and taxes?  

(Or more likely that balance plus every late fee, penalty, escrow shortages, and anything else the lender can declare owed.)

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