So whether your son gets it as a gift and in a year or so sells and 1031s it, or whether you gift part of it to him and then you both sell and 1031 as tenants in common - both would be proper use of the 1031 exchange. 

These are financial institutions that I like to describe as "E*Trade with different paperwork". 

Asset protection,Reside in CA, and read about RE investors having the option to start a LLC in NV that's within a trust and also purchase an umbrella personal liability insurance policy (upwards of a $1m - 2m+), to give aspiring RE Investor the proper business structure, security and protection in case of the inevitable lawsuit and/or other costs of doing business. 

(For the first year after you buy it, make sure "fair rental days" on Schedule E is an accurate number.

(E) Give the tenant the option to use incandescent bulbs as originally intended, or you will solve the problem permanently and go with option (D).Thoughts?

I will look up on how to properly clean it up and send my friend who's in the area to do it.

I almost never use E/M (Texas) because sellers don't care as long as I'm solving their problem.

Likewise, the fact that they didn't properly realize how good they had it with you for so long isn't your problem.

I was told this was not proper. 

Much more likely to make a mistake and buy in the wrong area and overpay if you don't do the proper research.I generally only recommend to more seasoned investors, but it can definitely be done.