Purchasing a property from an owner for less than market value

[Derrick Hilton]

I’m planning on purchasing a property from an owner/tenant for what they currently owe on the property.

At the moment they owe something like 10% of current market value on the property.

I am assuming the additional 90% value I’m falling into would be considered a gift in some way. Am I going to get hit on that additional equity tax-wise?

This is only further complicated by the fact that the deal is not at arms length.