How do we minimize taxes on the profit we're making on this first home? 

As you are partnering with your sister, have a legal document drawn up as to what happens if one of you wants to sell and the other doesn't, how expenses will be split along with money you are putting down, borrowing, profits, etc. 

Would you buy a property where you have to give half the profits away for life? 

Should I go through with taking ownership of the property and try to salvage it for profit or do I refrain from even involving myself in the situation as it may cost more than it's worth to save it?

In construction, there is only so much you can do to reduce your margins while staying profitable.

When the time came to sell, I anticipated a solid profit from the deal.

So back to being a real estate investor: the only way to be one is to buy a property and create value out of it, whether through finding a below market value house and selling for a profit, or renting and creating cash flow.  

I've never heard money/profit described as cute, so it's not important.The most important thing you mentioned, was the rent potential and ARV. 

Then the person is soured on gambling on real estate and not around here to answer questions. 

Sold it for a profit fairly quickly.