View report*This link comes directly from our calculators, based on information input by the member who posted.Been looking at this deal and it makes sense to me. 

Also, going forward, do i just report my percentage of the rentals and expenses on Schedule E or does there need to be a partnership return also?

It won't make a major difference, but if you have any other blips on your credit report it could cause a big enough drop to jeopardize your refinance on the BRRRR.

In the same report the inspector is recommending to the buyer that We (the seller) "treat for termites against further termite damage.

View report*This link comes directly from our calculators, based on information input by the member who posted.

Not sure how CA handles it, but for example signing a new deed, of any kind, today won't help since that will screw up your "seller's" tax reporting, even though that was years ago. 

Their reportable income is low and most of their net worth is tied up in their share of their business.

How do they pay rent, how do they report maintenance, and anything else you need them to know.

Since the the LLC is owned only by my wife and I and the previous property was only owned by my wife and I, at a federal tax level, there is no difference in how it would be reported on our taxes since we file jointly. 

You'll have reporting requirements with the IRS (like Form 5472, among others) and the penalties for not filing correctly are $25,000 plus.