That is normally where you make your gains.Just realize that sometimes you do lose money in real estate.Hope this helps. 

Use any CPA and treat it as normal income. 

-Sell one of the homes and clear the mortgage (throwing in personal money) and continue to rent as normal-Sell all properties 1031 exchange using as a down payment and go after a commercial deal (8% cap or better) I’m leaning towards the last because as I advance with my career, it takes up more of my time.

Is this something normal that investors do?

It normally takes 1 h 30 from Cancun airport to Tulum and that's what it's taken me on average - it can be less with low traffic and if your driver speeds because you could miss your plane ;-).

The loan was a normal 20% down mortgage.

You normally report your rental income and expenses on Form 1040 or 1040-SR, Schedule E, Part I, when you do your taxes.* What do I do to ensure that my property is safe legally from any lawsuits?

2-3 years ago, everyone was coming out of Covid quarantine and they were spending money on anything vacation wise. numbers now are settling back to normal, but prices on properties havent rightsized yet

Normal wear and tear excepted.

I think it is actually stabilizing/normalizing - at least here in FL.