Example: If I have 50k to start with and have to put it all down on an investment property, do I have to save another [50k or some other amount] to put down on my next investment property?

If I were to finish off this bedroom/bathroom in the basement and rent it out for $425 a month then I would go from losing $220 a month to saving $195 on monthly living expenses. 

I would simply say to them that I've never dealt with this situation before and so I'm unsure of how to resolve this situation so I would ask her opinion on how she would like you to help and see if the resolution is viable and feasible.

The tenancy might have been saved if there had been good property management.

What I mean by leveraging the capital gain tax is if I set up an LLC and have my properties under the LLC, would I be able to save some tax while it’d be a business profit gain?

This may be resolved by now, just wanted to add that if they pull the "ESA" card (emotional support animal) it sounds like you may be exempt (landlords owning <3 SFH not leased by realtor are exempt). 

@Malik Batchelor I would suggest getting the Driving for dollars App for $20 bucks a month and save yourself a TON of time and just input the address and save it to a list you build on the APP and then BOOM there is all the owner contact info with even a Phone number.

In her mind you can use the deposit to cover her rent for August and she will save her money so she can use it as a downpayment on the next unit.If you tell her you don't intend to renew at the end of the lease, she will pay August rent but she won't pay September rent.Let's pretend she pays August rent on the 8th.

It really comes down to how much you have saved and how much you'd like to keep in the bank vs pay out each month. 

Pinch your pennies and save until you have enough money to fund your own deal.