Any games you played with "renting" to yourself are null and void and you are now responsible for reimbursing uncle same for any unpaid taxes plus penalties - plus they're going to go thru the rest of your stuff with a fine toothed comb.That being said, there was always a big advantage to having your home count as your primary residence anyway - you could sell it and not pay any taxes on the profit (deferred or otherwise).But now that they limited the SALT deductions, that may change. 

Additionally the seller could own many properties and have a master insurance policy at a much cheaper rate than what you can get owning a single property.Unlike in commercial retail NNN where the tenants reimburse for property taxes and other costs with a residential rental the landlord is basically getting gross rent so how well the owner controls costs heavily affects the bottom line.Landlord paid utilities for residential is another one you want to stay away from.

I could ask the seller to pay for it and reimburse her at closing.Any ideas on how to give this seller a recommended price that we can both have confidence in?

If you do decide to take on the current owner's problem, make sure you are very well compensated with a sizable price reduction to reimburse you for the time, expense, risk, and headache of evicting them yourself, however I would not advise going this route.

I'm just worried I'll end up submitting a bunch of deals (if they don't accept the initial one I have planned) and never secure one they deem "appropriate" (and therefore forfeit the entire $3000 since I will never GET an actual loan to pay back so I can get reimbursed at the end of the term).

I haven't had to do it, but would use their security deposit to buy the insurance, then reimburse the deposit when they paid me.Send them a letter specifying the lease violations and cite the specific terms in the lease being violated (paragraph 10 on page 2).

I would add the umbrella and see if you can add loss of income/rental reimbursement.

Not just for the setting up costs, but the process to get reimbursement is one of the biggest pains you will go through.Travis RasmussenReal Estate Agent and Superhost for Airbnb

Needs washer and dryer. (700) Family member putting down 20%, their investment reimbursed when property is sold, cash flow is split 50/50 between us.

Now my tenant asked me to reimburse both of them for their rabies shots.