Buying Parents House

[Greg Seldon]

I've been talking with my parents about potentially buying their house to 1. free up cash for their retirement and other real estate investing 2. realize tax benefits for depreciation and the house is 30 years old and needs some improvements/updates 3. get the house in my name in case they have immediate health issues 

I have a few questions if anyone has experience/input on these topics or if you have any input on things I'm not thinking about. 

1. They bought the house for around $200k and now neighborhood comps are around $440k - am I able to buy the house below market value or would this create a red flag renting the house back to them?  

2. Are they able to gift the downpayment or not being an investment property for me. 

3. When collecting rent on the house - can I just get data from rentometer or craigslist and stay within 20% of that to not flag IRS.