The interesting thing is that an LLC is normally meant to hold 'business assets'.However, a house-hack is both a personal property and a business asset.Therefore, the question then is, is there any protection being given to you.The next is, if the LLC is jointly owned, is there a partnership return due, which is normally due March 15 of every year.

Still not clear if you had a joint venture agreement or a recorded mortgage with a note in 2nd positionBut sounds like hard money lender foreclosed and it wiped out a second lien.If you gave loan in that persons name vs LLC then you could still get a judgment and recourse but if it’s only LLC with no personal guarantee then your options are go after LLC only (and hope their are other properties in the LLC)What due diligence did you do on this person originally?

Should the lease be signed by both the mother and daughter as joint tenants?

For purposes of this paragraph (e)(3), an activity involving the use of tangible property is not a rental activity for a taxable year if for such taxable year—(A) The average period of customer use for such property is seven days or less;(B) The average period of customer use for such property is 30 days or less, and significant personal services (within the meaning of paragraph (e)(3)(iv) of this section) are provided by or on behalf of the owner of the property in connection with making the property available for use by customers;(C) Extraordinary personal services (within the meaning of paragraph (e)(3)(v) of this section) are provided by or on behalf of the owner of the property in connection with making such property available for use by customers (without regard to the average period of customer use);(D) The rental of such property is treated as incidental to a nonrental activity of the taxpayer under paragraph (e)(3)(vi) of this section;(E) The taxpayer customarily makes the property available during defined business hours for nonexclusive use by various customers; or(F) The provision of the property for use in an activity conducted by a partnership, S corporation, or joint venture in which the taxpayer owns an interest is not a rental activity under paragraph (e)(3)(vii) of this section.

@Mason VitalisYou may be referring to the 2-out-of-five-year rule which states that you must have owned and lived in your home for a minimum of two out of the last five years before the sale to qualify to exclude up to $250,000 of that gain for individuals and up to $500,000 if you file a joint return. 

The fha 100 mile rule will be triggered whenever you try to vacate your current primary and also trying to use the rental income to qualify.However, this 100 mile rule can be exempted for the following rulesRelocationIncrease in family sizeVacating a joint owned propertyNon-occupying co-borrowerIf you are not trying to use FHA on your 2nd house hack, you can use conventional and the rules that I mentioned above will not be a concern.

Hello everyone--I bought a house in Virginia in cash jointly with my son 5 years ago. 

Hello - I have a somewhat unique situation that I am unsure how to best claim on our jointly filed tax return.

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Where it comes into play here is the older buildings with asbestos pipe insulation, or asbestos in joint compound and window caulking.