With it being my first investment I didn't have the reserve funds to make the improvements (10-20k).

I'm interested in what others have found to be the best approach(es) for improving the chances of collecting back rent.

This should be able to qualify for residential if it's 4 units and a 30 year amortization would improve cash flow. 

The situation has improved, however tenant A still feels uncomfortable with tenant B and feel that they are being passive-aggressive towards them.  

Like some of you have said, there is no way to protect yoruself frome very posible situation or hazard but the feedback I am getting makes me realize I need to continue to anaylize and improve on my lease yearly-which I will make a part of my process moving forward.  

Your basis is your purchase price plus purchase costs plus any capital improvements.  

Since that didn't happen it gives you the chance to do a long overdue improvement which should let you sleep better at night.

He has been told to put in as much as $30k for improvements to make the house more marketable.

Here are the details:Single family, Purchase price $25kRehab costs $23kARV $75kEstimated profit for flip is $10k (13.5% of ARV), or monthly rent is $800/monthI would like to make a definitive decision upfront because the improvements/scope of work will vary slightly depending on if this will be a flip or rental. 

I needed to tap into some of the equity created from the appreciation for improvements.