There are three options that may occur but we know the third has the same odds as a metor hitting the earth.1.

For joint owners who are not married, up to $250,000 of gain is tax free for each qualifying owner.If your spouse dies and you subsequently sell your home, you qualify for the $500,000 exclusion if the sale occurs within two years after the date of death and the other requirements discussed above were met immediately before the date of death.Good Investing...

I've read that this statute allows taxpayers to to ignore any "nonqualifying" use of a property that occurs after the last date the property was used as a primary residence. 

One occurance does not "confirm" anything. ;-) it's by preference, by agreement of the parties involved.

How does one research insolvent owners/find defaults and to pursue potential fire sales if/when said defaults occur?

I am very excited to be a part of this community and I love seeing all the support and networking that is occurring on here.

Hi, I am a very new investor, so please excuse my lack of proper terminology if it occurs.

The other property 3 out of the 4 units were rehabbed (the 4th may occur this summer).  

Changes are low that you will be reimbursed for the damages and sounds like you can't prove that they occured with their tenancy. 

The issue with the foundation then by the information you stated either occurred during your ownership or got worse during it.