Sounds like you got a winner there :) We actually just bought a new one last year- amazing location with main house on a great corner, and separately addressed guest house in the back that we rent out.

Until you actually file something, you are free to ignore whatever structure you set up.  

Keep in mind that the $625,000 pulled out is non-taxable because it technically a lone and actually has tax benefits.

I have some more reading to do but if I understand correctly I will assume title under the Ladybird Deed and can just continuing paying the mortgage from my parents current mortgage yet not actually "assume the mortgage" and not have it impact my eligibility for a future FHA financing.I may have awkwardly described what may be the strategy. 

What you can depreciate is what you calculated ($94k) plus whatever you actually spent on improvements.

Seems excessive to me.

Before talking about taxes, we need to figure out how your deal is structured, and that is an actual conversation, not a few sentences on a forum.

This was actually an on market deal that a realtor I interviewed and hired found.

And again, it's actually more expensive per/lb, and it’s not really food fit for human consumption.

Hey Allison, we actually do offer a mobile app for landlords!