I guarantee your life would be so much better if you removed her and replaced her with a good renter.Do yourself a favor: buy "Every Landlord's Legal Guide" by NOLO.

@Dallas Smith To defer capital gains on your investment property, a 1031 exchange is an effective strategy, but the replacement property must be held for investment purposes for at least two years.

If you remodeled, added a room, replaced a roof, painted, boosted the curb appeal, etc. that's a different story.

The out of the box strategies and set ups sold will never replace customized AP/Tax strategies based on individualized circumstances. 

It's slower, but patient people tend to make wise investments.

Are you trying to replace your salary then you can’t do it.  

If you're insuring a home to replacement cost, insurance companies don't care about appraisals or what the home is worth.  

Would it be wise to buy the land with cash we have or utilize as down payment to avoid PMI?

I gave her 30k in 2024 and that was to buy a new car to replace her 15 year old Accord (which just keeps on running). 

@Brett RiemensniderYou don't need to provide anything to your tenants tax-wise.