It's about processes , procedures and systems.  

My husband and I have decided we want to try to work through the city's procedure to legalize the in-law unit.

You probably won't cross all the i's and dot all the t's with your processes and procedures, you may have paperwork that would raise eyebrows at the IRS, but you stay alive - nothing else matters without that.

A M2M lease is most beneficial to a landlord.When a inherited tenant is on a term lease it is no different except the new lease is offered a month prior to the end of the term and again should be a M2M.Landlords should know and understand all state landlord tenant regulations to insure they are following all proper procedures and timing of lease notifications.

Well MA is not a place that is all that fast on the trigger to remove tenants even when everything goes smoothly.If you have not done it and are starting off blind and are buying a place with existing tenants so you aren't even executing an action based on your own lease (so god only knows what provisions are in there they can argue give them cause to not pay) I'd get an experienced attorney to handle it.Won't be cheap but should be a lot less likely to have issues, which can reset the clock from whenever a procedural mistake was made.

He would have to talk to the 3 remaining tenants about getting his deposit from them, and when they move out they talk to you about getting their deposit back.If he did pay a deposit directly to you, what you do with the deposit 1st depends on how the state statutes say you can handle security deposits, then it depends on how the lease says to handle security deposits, then it depends on how you want to treat the security deposit.I recommend you take advantage of this learning experience to list any and all items you did not take into account before renting to room-mates - then make sure all of your documents and procedures (and the state laws) allow you to operate how you want to operate....Generally speaking, a tenant who breaks a lease early by moving out (let's assume proper notice was given and assume there are no damages to the unit) is liable to the landlord for the income the landlord loses by virtue of the tenant moving out early.

Just be sure to build the electrical billing procedure into the lease.

This now begs the question of whether or not this same procedure can be applied to multiple businesses within real estate and what would be considered gaming the system if you split out the lines of business.  

If she did, we would simply release the storage locker into her name as per the procedure allowed by the storage facility.  

Very nice policy and procedure Account Closed  ..