Considering you have just bought this property and inherited the tenant, I would also consider finding some ways to be in good standing with them before proposing the rent increase, they might not take it so harshly.

For four or fewer dwelling units, 30 days notice prior to listing is required.The Department of Housing will provide a form and the “notice to sell” must contain specific information including the proposed asking price.

Rent will differ on each home - it depends on the landlords situation and if the rent they are proposing works for us as operators as well.

Notably, we were able to work with local lawmakers to adjust a proposed bill that would've included STR's in an "empty home tax" that would've essentially made all the STR's on the island unprofitable.

I think the Brandon Hall proposal is very interesting.

If you are just getting started, good insurance may be the better play.Assuming you have a large portfolio, you know how to manage an LLC properly, are willing to take on the added paperwork and expense, and are not piercing the corporate veil by having mortgages in your name, here are my reactions to your proposals. 

If they are $600 below market, and market is $1200 you are proposing doubling their rent.  

In the H.R. 3936, Built in America Act, it was proposed to extend the 100% bonus depreciation until January 1, 2027.

There's nothing specifically wrong with your proposal, but I'd just do a rate and term conventional refi and forget the LLC.

This can lead to a more productive conversation and help you refine your proposal