The truth is, you best learning tool is to get out and start ACTION.

In order to evaluate what is best for you financially you would need to have projections on what the potential business could earn vs what you could earn strictly renting it out. 

Welcome to BP, @Mark Sewell, and congrats on taking action.

It is certainly possible to combine a primary residence exclusion and a 1031 exchange to completely eliminate most and defer the rest of the tax.However in your case with only 1.5 years of depreciation it might make more sense financially to simply forgo the 1031 portion and pay the depreciation recapture.  

My plan of action is to start attending REIA meetings in Austin, meet up with local investors, contact real estate agents, and consult with a law firm.

Hello Everyone,My name is Mark Horn, I am committed to achieving financial freedom in the next decade, through rental income and real estate investment. 

Your electrician should be able to give you the best course of action & it's going to be $$$$.

If you give money to the prior owner who was already in a financially unstable situation, it may not get paid and you will be in trouble.

It's like the lawmakers think every rental property is owned by a billionaire, when in reality most of them are small time landlords who have no rights and can be financially ruined by these tenant friendly laws.Thanks,Christian 

Why do you believe there is a financial advantage to spending money on the exterior of that property.