Tell me, have you ever changed the anode rod in your heater? It sounds to me like the magnesium anode rod may be totally spent and the tank/tappings are staring to corrode (gives that characteristic reddish color you mentioned). Anode rods are sacrificial rods that break down readily and help slow the breakdown of tank tappings (increases tank life).
You could try removing the anode rod and inspect it... if it has not already fallen to the bottom of the tank. Here, you would shut water into the heater and drain off about 5 gallons of water from the boiler drain (open hot side of a two handle faucet if you have one to allow water to drain from hot pipes a bit).
Then that anode rod is either under that LARGE 6 sided nut on top of the heater or it is part of the dielectric nipple on the hot water tapping of the water heater. If no separate nut up top, you will need to shut cold water off (drain 5 gallons off) and then cut the hot water pipe to be able to remove the nipple and anode rod combination.
If a large separate nut, then you will need a 1-1/16" six-sided socket (or 1-1/8") socket and a persuader bar (a piece of pipe or something to extend your leverage... THESE are hard to loosen, and usually make a snapping sound... but go for it... and it will come right out) to remove that anode rod plug on top of the heater
Inspect the rod... what do you see.. Is there even a rod left?
Then , if looks as bad as I suspect it does, you are off to the plumbing supply house to purchase an aluminum anode rod
(less reactive than magnesium rod... so better for your type of water supply). Replace the rod by reversing steps, then purge/flush that tank like bob (ballangerb1) suggested... flush out all remaining sediments left behind by old anode rod. Hopefully, that will fix all these issues and give you another 5 years out of that water heater.. Otherwise, time to replace that water heater...and then in 5 years replace the anode rod....up to you though.
I have provided pictures of the two different types of anode rod (collapsable and dielectric nipple types).
I also added a pic. Comparing new anode to old anode.
Hope this helps. If it does, please RATE THIS ANSWER
. Thank you.