Some might be depreciation recapture,  Your state makes a difference. 

But, it's critical to evaluate the state of the local market, your capacity for managing several properties, and the possibility for cash flow.If you see great potential for long-term appreciation and are okay with the higher property price, option 2 can be a good course of action.

As Chris stated, your renovation budget is way off.

After exhausting all avenues to cancel my policies with them, it finally took a letter threatening that I'd file a formal complaint with the state's Attorney General office to get them to cancel my policy. 

Third question, it's remote, out-of-state rental, and my first attempt, I need some advice, what are the red-flags I should prepare for?

Accountants are in such demand, that the best are not even accepting clients half the time.The other problem I see often with accountants on here is that they specialize in larger investors, and have really high prices when you as a smaller investor do not need all the bells and whistles.Another thing I see is folks thinking they need to have a tax professional in their state.

If you sold for $270k and received $250k after selling costs then paid $50k in state and local in some tax you only received $200k.

 My concerns and focus in this phase of my life is long-term financial planning - retirement etc (46).I dont have any retirement savings except my job offers a State Pension and I own 2 single family houses.

Would there be there any issue with me simply modifying the notice to quit forms to fit the lengths of time stated (30 days and 10 days) in their lease? 

Happy to share some experiences I've had as someone who started off by investing out of state.