- Is there ideas to structure the deal to avoid as much tax as possible on any portions of this scenario?

Let's say someone had gotten a chunk of money, this year, and wanted to invest it to avoid as much tax as possible. 

It's a fine strategy (I'm in LA and it's most of what I've done), but I wouldn't make low-tax as your buying criteria.

I know it should be exempt from the tax as I've changed a job to Texas.

If you are just doing a refinance for the $150k, no tax as a loan is not income. 

And $47K when left in your own portfolio represents easily another $4K - $5K of annual revenue ( not including any arbitrage on leverage) that you would get if you kept the tax as opposed to that ever so satisfying feeling of signing your name on the largest check you write next year - to Uncle Sam.BTW - Don't forget that an appraisal of $325 is far from a net sale of $325. 

-Ability to set up corporation to pay less taxes (would this be the 7.5 ssn, or are there others), deduct all expenses related to business activities (gas driving to rentals, CPA/Attorney fees, home office possibly, etc.)You have already mentioned that rental income is taxed at a lower rate due to no self employment tax.

Since you'll be living there you can AirBNB according to Aurora's STR rules: https://www.auroragov.org/UserFiles/Servers/Server...You'll just need to get a business license ($40) and pay 8% tax.

Also, don't forget about the net investment income tax as well in completing your estimates of tax. 

If this was normal transaction between direct  buyer and seller, there would be no tax as seller is in the loss position. 1) If this house was used and reported as rental from the sister to brother, the sister could use the loss to offset her other income. 2)) if this was not a rental, and sister had just let the bother live in the house, sister cannot use the loss.