This property also launched my short-term rental journey, running our first Airbnb before transitioning it to a steady cash-flowing rental, allowing us to scale into bigger projects.

Short answer is this is not the market to be investing for cash-flow. 

However, if you provide substantial services—like managing short-term rentals similar to a hotel—then income could be classified as earned income and subject to SE tax.The primary benefit of REPS is the ability to deduct real estate losses against W-2 or other active income, reducing taxable income significantly.

As an owner of several short-term rental properties, when my guests have an issue at one of my properties, I do everything I can to make it right.

Despite the previous owner raising rents last month, she is still falling short by $5,000 each month.

Quote from @Ben Trageser: If you live in your short-term rental (STR) property in a future year after claiming depreciation, depreciation recapture does not occur immediately.

I am from out of state so wanted less maintenance in the short term while I build my portfolio and grow to the point where I am comfortable hiring a manager!   

They would be resistant to a short sale. 

Financing for RenovationsSince the property needs a full gut job, consider:Hard Money or Bridge Loan: Short-term funding to acquire and renovate, then refinance with a long-term loan.Private Money Lenders: Individual investors willing to finance the deal for a fixed return.FHA 203(k) or Conventional Renovation Loans: If you qualify, these loans roll rehab costs into the mortgage.3.

Once the work was complete, I refinanced to pay off the hard money loan and held the property as a long-term asset.This duplex also marked the start of my short-term rental journey—we ran our first Airbnb from one of the apartments before scaling to bigger projects.