I believe there is a way to get out of this situation in a fair manner, i.e, I fix the items that ought to be fixed, but am allowed to defer certain maintenance that I have the prerogative to decide, I think it is just my lack of knowledge on how to deal with the situation, hence I am reaching out for help on how to get a fair judgement.

Even then, you may be able to defend your "for profit" intention, depending on the circumstances.An analogy: if you wear a police uniform and carry guns - you are presumed to be a legitimate cop (other than in a Terminator movie).

That means you establish a Traditional LLC to carry out the operations of your investments, in order to separate the liability from your assets, including: paying property management, paying contractors, collecting rent, marketing, etc.

Never Just so I can be educated on this, can you point me to the Texas General Statute that requires the insurance in the manner you describe in a subject 2 deal?  

If the income is subject to UBIT and/or UDFI, then filing would be to your advantage, as you could then carry forward that loss to offset any potential income in future years.But, investing in a syndication does not automatically create UBIT or UDFI exposure. 

It had the benefit of turnkey investing without the markup involved from the turnkey operator, and allowed me to build a team that could carry me into future deals.

You are saying one block and lot designation carries two zones? 

However, I will be focused on the BRRRR strategy and trying to format the partnership between my Uncle and I in an equitable and just manner, specifically in regards to rental income and equity over a 10+ year basis.

I'm a single mom of 3, so after carrying dependants, I'm sure there wouldn't be much of a tax bill. 

“Any net interest expenses may be carried forward indefinitely and allowed as a deduction against net interest income in future years.”