If you do decide to go the business plan route, reach out to me as I have extensive market research for PM that may be of good use to you. 

So after paying taxes, closing costs, commissions, rehab, utilities, insurance, buying side closing costs, and any addition costs, that's when you split your profit 

You also need to understand from your local zoning/planning authority how difficult it would be to split the lot, and if you do, how expensive it will be to connect to utilities etc for any additional mobile homes you try to set up. 

Whereas before all of this happened we had very few shared expenses besides the rent and the utilities, now most of our expenses were technically shared so it just made sense to do it.. 

Utility costs?

Is there a way I can still charge utilities to the tenants on the second floor?

After the variance is approved, you will need to get a building permit which may require plans review if it's an extensive addition.

The tenant applied for social service assistance, utility assistance, etc., and they never missed a rent payment. 

Did you include utilities into your calculation (water/sewer), lawn/snow removel, capX, and repairs into your rental budget? 

I made offers much lower than that when the repairs are extensive.