Question? How to minimize capital gain and retire?

[Vincent J Brunori]

Question? Trying to purchase 4 properties (48units) from a long term investor who is looking to liquidate her portfolio and retire. They would like to finance the deal but would want to minimize capital gain. The seller is open to any creative ideas. Any advice would be appreciated. 

Value= $2.2M

Down Payment= $500k

Interest Rate= 4%

Thank you

[Wayne Brooks]

@Account Closed The cap gains are not due all at once upon sale.  As Principal payments are received, including the down payment, the principal is divided into 3 buckets, as per the appropriate ratio ...1) return of basis 2)cap gain 3) depreciation recapture.  1) is not taxed, 2) and 3) taxed as appropriate.  Any interest payments received are taxed as interest income.  Exactly in what order the taxable funds are taxed (cap gains verses depreciation) I do not know.