Will your partner be upset because you are getting the better end of the deal living rent free(assuming you aren't paying rent).What if only your name is on the mortgage and deed, then the tax documents will all fall on you and your tax return and not his which makes it more complicated trying to shift income to him.If there are two people on the mortgage, it will impact both your DTI ratio's equally in full hurting both of your abilities to get credit in the future until the property is sold.Why can't you do the live in flip on your own?

If it's a primary residence the total loans of $400k (1st + 2nd) equals 80% CLTV (combined loan to value) of the purchase price.

I want to gut it all and add about 90 additional square feet - 415 sq ft total - for an open space guest suite.

Although if you paid cash, youre always free to forgo insurance and assume the risks yourself.

Feel free to reach out if any questions arise along the way.

Only the expenses related to the rental portion can be written off.Allocation can be based on the square footage of the rental area relative to the total square footage of the house.As for your deductible expenses, you will need to allocate the expenses between the personal and rental portions of the house.

After 3 weeks of receiving the appraisal (2 month total process), I got a text from Harold (Insula Rep) that they will decline to lend. 

An LLC is not free.

Transferring Your LLC via Will:Review Operating Agreement: Check if your LLC’s operating agreement addresses ownership transfer upon death.Update Your Will: Specify in your will that you intend to transfer ownership of the LLC to a named individual or individuals upon your death.Consult an Attorney: Seek advice from an attorney specializing in estate planning and business law to ensure your will is legally sound and compliant with state laws.Consider Tax Implications: Understand potential tax implications of transferring LLC ownership through your will and plan accordingly.Notify Your Successor: Inform the person named in your will about their future role in the LLC and provide necessary documents.Please feel free to reach out if you need any further assistance. 

Anddd, I upgraded my phone for free!