However, she claims she can’t afford the electric bill and refuses to keep the heater on continuously.

@Nathan M kieferI recommend that you get professional financial/tax advice.

@Christine AledamIf you create a California LLC, the $800 cost is a tax deductible expense. 

You will get some cash flow, appreciation, and tax benefits along the way.

For expenses like utilities, property tax, and insurance, I estimate a 3% yearly increase.However, keep in mind that if you do renovations in the first year, it’s likely you won’t need the full 5% repair allocation for the first or even second year.

Some of my Scottsdale connections who specialize in land deals have been whispering about how a few smaller outfits in Casper.. from what I’ve heard, outfits tucked behind older storefronts, have been matching buyers with off-market parcels that never even hit the usual channels.If you line up your financing carefully (no legal or tax advice here, just speaking from experience), you can sometimes lock in a deal that ages nicely over tthe years.

But the other side of the coin your expenses go way up when your employer is now not paying you any bene's and you have to pay all your own health retirement self employment tax AMT tax etc etc. trying to do this with max leverage is going to be a long slog to replace a 150 to 200k a year job with bene's.

but I'm just not sure about the tax credits.

Other than outstanding taxes, and utilities, I don't need to worry about anything else.

Sources for insurance and property taxes: Insurance—ValuePenguin, State Property Tax Rates—Rocket Mortgage.