Yes, looking over the laws for KS, it just mentions some items that fall under ordinary wear and tear and excessive damage and filth.

You'll pay ordinary income, probably self employment, and ACA surcharge tax - could be 40%.If your intent is to hold it for productive use then you can 1031 and the tax is deferred into the next property.If your intent is to live in it and you satisfy the residency requirements of 2 years residence out of the 5 year period prior to sale then you get the 250/500K tax free option.Each one has their uses.  

If it's a flip an that was your intent it's going to be ordinary income to you, and taxed at your individual tax rate 

But I did do new concrete in the basement/patio.

I've also heard of people making a "balloon" payment at the end of the term instead, do either of you know if that is more out of the ordinary?

The other thing is doing this will have no impact on your tax situation since a flip is taxed at ordinary income tax rates no matter how long it is held.

They are out-of-the-ordinary and lenders don't treat them like homes.

As far as I know, nothing prohibits you from partitioning off a portion of your home & renting that to a "roommate" with whom you share no living space  (a bathroom, bedroom, & den that are accessed via the patio, with a kitchenette with microwave, for instance).

Yes, you can charge them for any damages that are not "ordinary wear-and-tear" on the home.

You don't want to wait until they vacate and then get hit with a large expense along with the ordinary turnover in vacancy costs.