Further, he doesnt have enough exemptions to exempt all the equity.

A transfer to a trust is exempt from due on sale violations since banks will view transfers to a trust as an estate planning tool.

I would start by going to the bord and requesting an income exemption or better yet see if a co-signer will be acceptable for income purposes..

Exempt from Unrelated Debt Finance Income Tax: While investment income from real estate that is acquired with debt (which must be non-recourse financing) and held in a Roth IRA is subject to UDFI tax, the same property held in a Solo 401k is generally exempt from UDFI tax.Early WithdrawalsWhile the contributions can be withdrawn from a Roth IRA before the earnings, any early withdrawal from a Roth 401k is subject to the pro-rate rules which means that you must take both the basis and the gains.

Any homestead exemption would be lost though. 

There are a couple of places that were exempted down by the beach but that's it.

I moved in the week after, and since I don't plan on selling for the next month or two, I should be over a year and a day (to have long term capital gain rates applied) but less than 2 years to pass the Use test to be exempt for the $250k capital gains.

Even though you've owned it for a long time you are changing the nature of the property in order to resell.I think the more important question would be can you take the primary residence exemption and get part of that profit tax free.  

No where in the state are transfer taxes that high, nor are LLCs exempt from transfer taxes?

Issuers can rely on Reg S in addition to other exemptions, meaning the safe harbor rules are non-exclusive.