She proposes to use her security deposit money to cover another month's rent, to be paid once it's released.

Unpermitted work like you are proposing is not legally permissible in most jurisdictions.

The answer: no purpose whatsoever in your proposed "quitclaim transfer the deed into an LLC."

Thank you for the response; I will propose a cash-for-keys trade-off.

I'm not sure if this is always a requirement or recent due to legislation against steep rent increases.

How much should I propose? 

In an attempt to clean up the industry, legislation was written by those who 1) had never been lenders themselves and had no understanding of the industry and 2) their biggest campaign contributors were big banks (look up Barney Frank, Chris Dodd, and Elizabeth Warren's campaign contributors at the time and you'll see big banks).

Is it a good idea to send them a no pressure letter in the mail proposing a conversation to possibly to solve there issue?

The ordinance may require a permit to be obtained for the creation of a junior accessory dwelling unit, and shall do all of the following: (1) Limit the number of junior accessory dwelling units to one per residential lot zoned for singlefamily residences with a single-family residence already built built, or proposed to be built, on the lot. (2) Require owner-occupancy in the single-family residence in which the junior accessory dwelling unit will be permitted.

Hi @Brian Moore, The IRS has issued proposed regulations that classify the Monetized Installment Sale as a "listed transaction."