If you have no insurance, your LLC would have to pay for the legal defense. 

One of my tenants quit paying rent almost a year ago.

You appear to have found a property that doesn’t require property tax payments, title, hazard, or fire insurance, and a closing attorney or title and escrow that works for free on both the purchase and sale side.

USPS forward and pay for the permanent forward service.

Their systems make it easy on both us, and the tenants, and we greatly appreciate their owner portals and end of year reports for when it's time to file taxes.

That is probably true, but who is going to pay for it?

Do I then need to pay capital gains tax on the $550k amount or not?

what I really watch out for is JUNK fee's you may have 1 point origination but by the time you add up the junk fee's your really paying about 4 points or more.. this is the only way they can stay in business.. there is no way a lender can do a loan as you describe and the sum total of their income is 1200 bucks..  

When you say pull your money out of it, would you be paying cash for the property?

Today, we've returned to reality, which is, you've got to work vacation rentals for them to really pay off.