So I figured that as long as he agrees to it we wont even need to get any legal consultation (there is an actual addendum in our LLC binder which carries a "transfer ledger" section as well as stock allocation certificates numbered 1-20)We have a long history of working together and our base of trust is greater than any contract, but of course we have to have that set in place in the event of an unforeseeable event.

How is your time allocated?

If he is a member/partner in the LLC, the share of profits will be allocated based on the LLC Agreement.Each person would then be given a k-1 showing his share of profits / losses.

What is the customary allocation of closing costs.

I anticipate the demand for a rental will get higher in the next 5 years so my plan is to allocate extra money into more units.

A $250k ADU will not produce close to $3k income after properly allocating for expenses.  

This “front-loaded” allocation method is consistent with IRC § 1(h)(3), which defines adjusted net capital gain as the residual category of capital gain not taxed at higher rates.You would have already recognized $6,444 1250 gain as part of the down payment.

My budget is limited, so having already addressed what I think would be considered necessary for this property, I am trying to determine how best to allocate remainder of my funds, both to attract a higher income renter now, and keeping in mind long term maintenance costs.I think I can afford one or two of the following three options, but not all of them:-Kitchen countertops terrible and need upgrading. 

However, keep in mind, if you’re house hacking, you will need to allocate that between rental (schedule e and deductible) and personal (schedule a, potentially advantageous to use)

No I will probably charge you $190k because that is what is worth our time to allocate our resources (subs whom we've worked with for almost a decade) for such a small project.