I've bought and fixed 2 houses with him and they are rented.He got brought a portfolio of mixed residential and commercial units that are very underented and need mostly cosmetic upgrades. 13 residential, 6 commercial, and a lot currently being used as parking.

283 Storage Unit Facility - residential area close to Oklahoma City.almost 2 acresTotal Sqft: 26,400Price per Sqft: $10.80Price per Unit: $1,007.Unit Mix:130 5x10 109 10x1044 10x 20My thought on what Market rate rents would be:5x10 - $5510x10 - $8010x 20 - $160Property seems to be in excellent condition - on a scale of 1-10 it would be an 8.

I would be uncomfortable with mixing business with family. 

It's also been the location of my audio recording and mixing studio!

What you have is a mixed use property that will allow you to take part of that gain tax free and the rest will be tax deferred.Since you've lived in part for 2 out of the last 5 years you can take the amount of profit allocated to that part tax free.Since you've used the other part of the property for investment it qualifies for a 1031 exchange.  

I don't calculate appreciation into the mix because markets go up and markets go down.

And don't be surprised if the house has room additions for the foundation to be mixed. 

Now that I am mixing finances, am I negating the protections provided from the LLC and opening my personal assets up to a potential lawsuit ?

Now that I am mixing finances, am I negating the protections provided from the LLC and opening my personal assets up to a potential lawsuit ?

Anytime you're mixing your living situation with your investment goals you need to carefully consider what trade offs you and your family are willing to make.