I'm aware that every situation will be different in respects to: current bank loan/ back taxes, leans, owned outright with no mortgage/ property condition and location what I am struggling with is what are the things I need to be aware of.

Anything I should be aware of?

Is anybody aware of similar ordinances(limiting rentals), put in place by other municipalities in St.

Just be aware that the financing issue will need to be addressed at some point.People in foreclosure can often be "upside-down" or "underwater" on their financing, not just (WAY!)

I am aware of the Chicago city transfer tax, but wonder what your experience has been.

You either get what you want or you walk away from the deal since your financing depends on it.However be aware that banks do not follow up on the occupancy financing requirements so you could simply not move in immediately while you are evicting, Even if the bank did find out they would not have a issue since it is still your intent to move in.

Of course, just be aware that it also comes with its potential risks.

My only advice would be to be really aware of where you are flipping and the nature/desires/expectations of the buyers.  

You should be able to deduct your expenses as long as you were trying to rent the property.Since I am not aware of your personal circumstances I cannot give you specific advice, but I would advise against doing your taxes online and find a qualified professional to help you.  

Lastly, be aware that sometimes the BK agreement includes a cram down.