Property from parent to offspring then refi?

[Titus Chang]

Good Day! I've read numerous posts on topics very similar, but not exactly asked in the specific terms of what I'm interested in. 

(Ohio here).  My aging parents are looking to downsize out their primary residence (which is paid off) to smaller condo that they also own.  They are hoping that my wife and I will take the title/deed to their primary house and move in as our own primary residence.  As part of this transaction, we all agree that it's fair that they are compensated for the home, but most likely a significantly reduced percentage of market value.  What would be the ideal way to facilitate this whole transaction? 

I would think that my parents would first quitclaim the deed to my wife and I.  Then my wife and I would obtain a cash-out refi, to pay my parents  (I also like this because it would enable my wife to continue to have a tax deduction our yearly tax filings).  Is this a realistic method? Additionally:

- Can the quitclaim deed process remove 2 individuals (my parents) from a deed and then replace with 2 individuals (my wife and i) - simple swap out?

- Will the exchange of on deed be considered a gift, which either my parents or I would be required to pay taxes on said gift value?

- Will we need to allow the title to season 6 months before we could apply for the refi? If so, does the 6 month requirement mean that we have to be a resident at the property for 6 months or just that the names are on the title for 6 months?

- If my wife and I remain there for 2+ years, are will except from capital gains tax later if we sell?

That's all...for now! 

Thank you for the knowledge!