Probate Purchase Under Courts Value... Help!

[Chris Wolfe]

I am purchasing a property for $900,000 from a relative.  The issue is the court has appraised the property for $1.175m as is.  (Worth $1.4M after rehab).

The relative/seller only wants $900k and I could buy for the 1.175M and he would give me the overage of $275k back but that would trigger for him another $275k in income that he would have to pay taxes on.

Are there any creative ways I can solve this?  Could the seller somehow pay my contractor out of escrow $275k?  Any ideas?  Also my understanding is that technically I can purchase for 90% of the court appraised value so $1.057M but that still leaves a $157k gap I need to creatively solve.

Any advice would be greatly appreciated!