Simply gifting him half the property now wouldn’t immediately allow him to claim the exclusion without fulfilling this residency requirement, I don't believe.One thought would be to use a HELOC to pull just enough equity out of the current home and use it to buy a smaller home, or at least the down payment.

This would end up getting you some tax benefits and extra cash flow that could help you leverage that into another property...maybe a 1031 exchange.

Where to spend the extra for durability and sometimes having to sacrifice aesthetics for durability, etc.

While a properly maintained TN LLC might be sufficient for those who diligently follow corporate formalities, the additional layer provided by the Wyoming entity can offer significant extra protection, albeit with increased complexity and cost.

And if they don't deliver, you need a truck and an extra person.  

I just had to take extra money out of my personal account and funnel into my rental account. 

Nope......i heard of it on a podcast though.i actually have studied banking and economics for the last year and a half.

Any way you can make extra income to throw at the 40K CC before selling? 

Wish I had remodeled the space that is the dining room into an extra room to improve cashflow.

It's easy to obtain, costs very little, and doesn't require extra, on-going effort to maintain.