In my case the mortgage closed prior to their required date in 2016, and is 4 years old already, so I am not eligible for transfer.So is my only other option here on the mortgage in question (a rental) to either just shoot for the umbrella insurance policy, or to refinance out to either a commercial loan or some other loan option? 

It it were not, then it would be called a fee of some sort.In addition in CA, after a tenant vacates a rental, the landlord is required to send an itemized statement within 21 days detailing what expenses, if any, were deducted from your security deposit as well as the balance of the security deposit.

Did you deduct capitol gains tax from this 'profit'. 

The landlord wrote into the lease that we are responsible for the deductible/service fee ($60 per) for calling the home warranty. 

AND -- before anyone mentions depreciation deductions -- remember, there is no such thing as a non-cash deduction (non-cash credits, sure, but no non-cash deductions) on your income taxes.

If I wait to do repairs until after July 1, can I deduct them?

Would forming an LLC allow us to deduct expenses with the rental?

That sounds like a more elaborate version of what's happening in Nashville, namely, condos that are appropriately zoned and STR-permit eligible, with HOAs that explicitly allow STRs.  

In either of these scenarios, is the cost of the mortgage principal payments deductible?

You should have enough reserves to cover at least one month of vacancyThe first one is easy, the third one is accumulated over many years, and the second one is learned by watching your expenses over a few years.For books:- on property management, get Managing Rental Properties and Landlording on AutoPilot- for taxes, Nolo's Every-Landlords-Tax-Deduction-Guide (get the latest edition every year) (and any other book for landlords from Nolo collection, they are all good).- for risk management,  Every-Landlords-Property-Protection-GuidePM me if you have questions or need more assistance.