Cash flow doesn't include non-cash transactions such as depreciation and amortization.Using $15k as a downpayment on a new property wouldn't be an expense for tax purposes.Your closing statement could be scrubbed for more favorable tax treatments (than 27.5/39 year depreciation), but the bulk will be capitalized.As Ashish mentioned, there are strategies to reduce taxable income, but what you're proposing won't.

If cash and capital gains are mixed then it gives rise to a pro rata treatment for tax benefits.For example if an investor invested $500k capital gains and $500k cash into a QOZ fund (and received stock) only 50% of the appreciation on the stock after 10 years would be tax free as only 50% of the initial investment was capital gains.The form to self-certify as an OZ fund has yet to be released by the IRS.If you have already invested cash into a QOZ for the tax benefits I would highly recommend you speak with a specialized real estate CPA who is well versed in QOZ's.

Not eligible for the new 20% deduction.The trick is determining whether the second part of your deal qualifies for the investor treatment.

I will list the numbers:current rent $1950/month (going to $2000 in about 6 months at end of 2 yr lease)My expenses: annual taxes $7950 ($662/month)                        Heloc balance $170k interest currently 5%                        land lord policy $1150/ year                        Self managed                        Maintenance : has averaged $300-400 per year.Reasons I am considering sale :   1) property is currently worth about $270k (making me feel roi is low).                                                           2) property has a pool which is a liability that I'm not completely comfortable with.                                                           3) property has a heloc balance against it of about $170k that I technically cannot deduct the interest                                                                       because it wasn't used for the property or any other rental.                                                           4) Tax treatment: my understanding is if you sell it having lived in it 2 out of last 5 years the capital gains                                                                 would be exempt. 

Thinking that a "bank" deserves any different moral treatment than a person is your mistake. 

If, in fact, bedbugs are found, the tenant will have to pay for the treatment.

Agree with @Carl Fischer that you should engage a tax CPA or EA to examine your unique facts and circumstances...However the distinction between who owns the roof is important and determines tax treatment. 

@Mark Kuster to qualify for the tax-exempt capital gain treatment in OZ's it would have to be a new build or significant renovation and capital gains would have had to been used to purchase the building through a QOZ Fund.

Based on my experience it will take a few "treatments" where the pest control company is leaving bait and traps.

Generally tax status is established by filing an 8832 or 2553 if electing corporate tax treatment, or by filing an initial return if electing default status.You'll want to run everything by your attorney and CPA as it seems you're going with a semi-complex structure.