@Earl Stewart JrIf your CPA messed up your prior tax returns (I don't know if he did, just working off of your statement) - then you need to find a good accountant instead of trying to DIY it and probably make it worse.Yes, you need to take your selling price and subtract all costs for the 3 years.

Then take the rent, subtract PITI ,variable expense and then you are left with your pure cash flow. 

Subtract out the other expenses as mentioned above with the rental calculator.

Subtract HOA fees; utilities; trash; lawn care. 

Cash matters when you back it with minimal inspections so they know it is not a bait and switch where you say I will pay listing and then subtract significant money after the offer based on inspections. 

You might convert the garage and gain 300-400 sq ft to your house, but if all of the other comps in your area have garage and now you don't have a garage, then you added value with the sq ft but you also subtracted value by taking away the garage.

Is the amount due subtracted from your offer or would this have to go through a different financial structure?

Once you have those two numbers, subtract, and 1/4 of the difference (25%) added to the lowest price is your conservative ARV. 1/2 (50%) of the difference added to the lower number is your aspirational ARV.Real estate is very regional, but I suggest you go on YouTube and take a look at some of the videos that @James Wise of Holton-Wise in Cleveland has put up on "Running the Numbers" and "MLS Search & Analysis." 

So your cap rate here would be 1750 (assuming 750 top unit rent) * 0.85 (subtracting 15% for your vacancy, capex, and maintenance) = $1487.50 minus prop taxes ($169), insurance (gonna say $80 here as a placeholder... doesn't really matter), sewer/water ($150) = $1088.5/month.Now cap rate is based off yearly NOI, so multiply by 12 = 13,062.

You would take all the income and subtract all those expenses and that will be your NOI.