We also include incidentals like accounting fees,  and legal fees (our properties are owned in LLCs), but those might not be expenses that you need to incur with your first property. 

@Etan Frankel although the government has a hard deadline of April 20th, 2018 to establish designated opportunity zones nation-wide, the investments wont happen for a short period afterwards while the IRS works on designating qualifications for the certification of an Opportunity Zone Fund.As soon as the certifications have been designated and the flood gates for applications are opened, i am sure you will begin to see many Opportunity Fund's pop up that would be eager to participate in the investment.

Rent the downstairs new addition (can be 2 bedroom) out for more, since it's bigger and no longer in the basement and is fully legal as a secondary unit (~$2200, 800sf)What would you do?

The engineer report will legally protect you. 

Am I exposed to any legal liability currently? 

But as a newbie, most programs are designed just to prey on newbies, and throw a bunch of information at you that makes you feel like you learned, and then they'll try to upsell you on more programs.

My real estate career consists of many years in custom home building, mostly on the design and management side. 

That said, sending 10,000 per month to a crappy designed list probably won't help you either.Cold calling is a good free source of leads.

I looked into legalizing it.

This is just my opinion, you may want to seek legal advise before signing any contract.