I communicated to him through text that I would like to end any future and to just go our separate ways (I will eat the cost).

The goal Is to eventually have enough money to keep them separate, but starting out is a weird in between time. 

I made some dumb mistakes when I first started (didn't go on BP and learn first), so based on what a friend was doing in CA (my property is in IN) I told tenants they pay for gas and electric but water and sewer was covered by me (water is separately metered for each unit).

Individuals will owe the tax if they have Net Investment Income and also have modified adjusted gross income over the following thresholds:Filing StatusThreshold AmountMarried filing jointly$250,000Married filing separately$125,000Single$200,000Head of household (with qualifying person)$200,000Qualifying widow(er) with dependent child$250,000Taxpayers should be aware that these threshold amounts are not indexed for inflation.If you are an individual who is exempt from Medicare taxes, you still may be subject to the Net Investment Income Tax if you have Net Investment Income and also have modified adjusted gross income over the applicable thresholds.NII consists of the sum of three categories of income reduced by any properly allocable deductions for each [Reg. 1.1411-4(a)].

Possibly separating it out into two loans, one for the portion we live in, and one for the business portion. 

You should be able to have separate bank accounts (one for your RE commissions, one for rental income, etc.) all under 1 LLC name.

The idea was to rezone the property, put each building onto separate parcels and sell all the properties except the Apartment buildings which we renovated all units and common areas and leased to new tenants for a long term buy and hold multifamily property.

I believe that deducting interest expenses on a primary home does not work the same way as it does on a rental.. from a tax perspective, it may be better to keep the two loans separate. hope that helps a little..

$500 closing fee on top of a $200 emote closing fee on top of so many title company fees?

I work in construction mgmt so I would constantly reel in the scope.Recommendations - get a really good property management company, start with a single family or at least separate meters, know the additional requirements on Cleveland landlords (yearly inspection fee, lead fee, etc) walk the house prior to buying.