Help me offer the best value to the seller

[Jason Burr]

I thought I would toss out a scenario and see what creative solutions folks suggest that might offer the best value to a potential seller.  Let's assume the seller owns a single family house that they have fully depreciated over the years as a rental.  The landlord is at the end of their career and does not want to purchase another property and isn't interested in a 1031.  Please help me understand the tax consequences to options that the seller has.  If I were to purchase the property straight out, I'm assuming the seller would then pay capital gains tax (15% or 20% depending on their tax bracket)  on the entire $100,000 selling price.  The amount which has been depreciated plus difference of sales price.  

If I were to give the seller 10,000 cash and the seller owner financed 90,000, how would this the amount owed to uncle sam?

Are there any creative strategies to lease/option arrangements with the seller?

I want to make sure that I do my due diligence and learn as many potential strategies in order to be in the best position to guide folks through the process of selling.

I realize that folks may not be a tax accountant/lawyer and I will be running all suggestions through my accountant for review.  However, there are numerous very creative folks online which I'm sure can offer good starting points for discussion.  Chad Carson, Brandon Turner, etc. 

[Paul Allen]

The seller will pay 25% on the amount depreciated. It is (charmingly) known as 'unrecaptured section 1250 gain', and it gets taxed at 25%.

Your description of the seller financing 90% of the deal sounds like an installment sale. This would spread the seller's gains out over the number of years of the agreement (and the tax bill), but it would not change the total tax paid by the seller. (Except that the seller would also be paying tax on the interest you are paying him/her.)