My further research indicated that any deficit in return on original loan amount is considered a "non-business bad debt" treated as short-term capital loss, but foregone interest is excluded (because individuals operate on a cash basis). 

Those are the properties that are eligible for 1031 treatment.  

I would suggest using local non-national banks they are eaisier to work with and you can establish a relationship just going to use them regularly instead of just poking in one day asking for what they have for you.

@Logan I.It seems like you have non-qualified use of the home since the property was originally a rental turned personal residence.Furthermore, there is depreciation recapture on the property that will need to be considered.You may want to see if you can convert it back to an investment property and take advantage of section 1031 exchange.

She wrote the check for 104k total, I brought the deal by always staying on top of the auctions, I handled the eviction process of the non-paying previous tenants, coordinated and managed the rehab, and will manage the rental for a 50/50 split of all cash flow and any equity earned beyond her 104k investment.

I need an 11th hour assist from my fellow BP members to be sure I am handling a tax situation correctly.

The situation: I purchased an investment property in July 2017 for the purpose of renovating, creating 3 units...

If you can't collect interest then put it in a non interest bearing account.

I have a non-residential rental property that I leased out last year and I am filling out Form 4562 for figuring out MACRS depreciation(39 years MM, SL). 

If using a lender this is a non issue.

The problem I have is I don't have much money to contribute yet, and I'm not sure how I can contribute time when my experience is non-existent.