Will & inheritance for 3 properties and 6 children

[Matt Eade]

Hello, My father is looking to re-write his will to accommodate me and my 5 siblings recent wishes. After explaining the below to his lawyer, the lawyer said it was very complicated with several tax implications (which we are trying to avoid of course). So of course I thought I'd ask fellow BPs. 

My father owns 3 properties in upstate NY. One is a 12 unit apartment building, one is a SFH and the other is a duplex. 2 of his children (myself and older sister) would inherit the properties (partner on the 12 unit and individually own the other 2 separately).

The other 4 siblings would get a cash buyout that we've all agreed is fair (and substantial).

The challenge is how to provide the cash buyouts as part of the will and avoid income tax for the 4 siblings... notes below from lawyer. 
Does anyone have experience with a "Time Note"? Is it different than a "note"

"If the payment is specified in the will, it is an obligation of the estate to pay it and cannot be classified as a gift even if paid out at a later date and therefore it would be taxable income to the 4 siblings."

"The subject of some kind of note came up. It could be a demand note or a “time” note, payable over time. The demand note could be problematic since the 4 siblings could demand the money at any time and that payout may not be possible. Also, if you are married and you unexpectedly pass away, your spouse could demand the money all at once--not a good situation."

"A time note would have to carry a stipulated interest (so as not to be considered a gift) as determined by the laws of your state. The interest would be income to you and taxable, but it may not be significant to make much difference to you tax wise."