For future deals where you are trying to structure an actual lease option agreement, you need three separate documents: First right of purchase, statement of understanding, and residency agreement/lease agreement.

It may not be worth it, as Matthew said, two separate properties are worth more.  

And if you are at all sloppy about the mechanics of the LLC- separate accounts from your personal, record keeping, etc, then you really have no protection at all.

This is what separates novice investors from experienced educated ones (I'm not saying that you are inexperienced!!).

I have a series LLC therefore I could add properties anytime without forming a separate LLC.

One other option that might be harder to contest is if each of you have separate businesses and the loans were made to the businesses.

We have a separate $1Mil umbrella liability for all of our properties together in one policy. 

SD is not your money and usually (depending on your state) has to be kept in a separate account and diligently accounting for any deductions.  

Build it into the rental price and pay the tax, or do I have the tax as a separate line item like your example of buying a tv?

I can't begin to tell you how grateful I am if I can get just a few startup questions answered...ENTITIESReal Estate BrokerageREI Tech Company.comProperty Mgmt CoConstruction CoFinancing CoREI Tech Co Apps/Software (IP Involved)REI Marketing & AcquisitionsREI Fix & Flip Co (Same Co as M&A)REI Buy & Hold CoREI Joint Ventures (Flips & Holds)Q: It's been advised that we separate each division beneath one Parent Company 'PCo'.Our DilemmaThe REI Tech Co would be a platform to make offers, auction, and buy Real Estate similar to RealtyBid.com, Auction.com, and Hubzu.com only targeted toward a completely different niche.We intended to charge a Buyer/Seller premium which would be based on a % of the total offer/listing/bid (TBD) in addition to fees for premium services (featuring property, BPO, web based tools, privileges, etc).No doubt the % would be viewed as a consideration for a Real Estate Transaction so the Tech co would need to be licensed.The buyer would have the option to use our Construction Co 'CCo' for rehabs/maintenance and Property Mgmt 'PM'.