Seller Finance while I House Hack- can that work for Seller Tax Purposes?

[Jen Stekkinger]

I have on contract a 4/3 split level home converting to a separate downstairs 1/1 apartment. So we will essential convert to a duplex. I am short on cash to close this deal and wanted to do a creative house hack. I have a partner willing to take the title and buy the property but, she is only interested in the tax benefits from the property. As a former investor retiring, she wants out of property management. She does not want the hassle. Thats where I come in. I want to turn around and rent the top unit as a house hack and get a renter downstairs. I will handle property management, maintenance and needed improvements. My goal is to buy the property eventually by doing a seller carry but how to I shape the deal so I don’t get in trouble if the seller changes the deal after I put in all the work and money to rehab the property? She needs the tax benefits for a little while so the title does need to be in her name for a few years to benefit from tax.

Has anyone done a deal like this or know how to structure such a thing?