There were some misunderstandings and tension between me and my family members but I had not expected what I saw that morning when I returned from my graveyard shift.

I had to re-read this several times to be sure I was not misunderstanding the issue.You had your last tenants stay there for six years.

That may be flawed logic if I’m misunderstanding the rental income piece, which I will try to clarify…Let’s say I was starting from scratch and wanted to buy a $500k house (numbers are just an example).  

I.E If you wanted to use the 13K to rehab a property, the IRA would need to own that property that you want to rehab first.On the second count, I think it may just be a misunderstanding.

If it's just a house you bought as an REO and fixed up (I may be misunderstanding you here), and you're flipping it, assuming the rehab was done well, that shouldn't be a problem.

It is not uncommon for tenants to misunderstand mold and mildew.

I'd have to list misunderstandings about money up there near the top of the list.Does it take money to do real estate?

My lack of understanding involves the "applicable exclusion amount for gifts" from the above article, and maybe we're misunderstanding the annual gift exclusion as well. 

It sounds like you need a stronger lease agreement that spells everything out in clear terms, so that there's no misunderstandings later.

Please do not misunderstand my comment, I never made a comment about having a higher ethical code because of my religion.