Offer to pay them off in 5-10 years at a higher interest rate.

Just ideas, talk to your CPA to make sure you are doing it properly. 

Maybe that is why the old owner didn't pay their taxes?

When you have studied your market properly you should be able to provide the answer of if single family or residential multifamily is better for cash flow. 1% rule was for a time when almost all deals were decent as a way to rule out the lessor deals and concentrate on the best deals.

Having the books properly set up for the first time ever will help me get all the deductions I’m entitled to.

If you have 30 years uninterrupted with no complaints or major complaints I have never had a complaint and have been licensed 50 years once you hit 70 no longer need to do CE just pay the fee every 4 years :) 

You must give proper notice before each showing, you must give the renters the opportunity to buy the house first, and the new owner will have to honor their lease if they intend to stay.

You will need an attorney to properly structure the partnership and you will make sure you do it correctly.

She refuses to pay rent and says she cant be out until April.

Wealth-drivers are appreciation, debt pay-down (ie. principal payments) and tax shielding.