During the escrow is it possible to put it in a LLC... or would that trigger capital gains taxes?   

Those that don't can take the cash and the tax hit. 

Can anyone drop a line to a good tax account in Tacoma WA?

But I would wait for Seattle and other hot markets to stabilize, the city government are morons - for example almost passing 150$/head tax to combat rampant homelessness.

Or if they do forgive the debt, the seller will have to claim it as income for tax purposes.

What would be the better option when purchasing a first home, cashing out early your 401K, using that money as a lump sump down payment and facing the tax penalties, or making a smaller down payment and facing higher interest rates long term?

I got my own quote on insurance @ $2200 per year and it matched what he said, he says the taxes are $3300 per year and he pays for rent on the 2 propane tanks for gas to the units, tenants pay for gas, and he pays something like $50 a year for electricity to run the well pumps for water.

Oh, but don't forget to deduct tax on that).I reckon there are just too many uncertain variables to risk paying (at least) $89k on a home that sold comps say should be worth $99k (if rehabbed to market satisfaction).Looks to me like the "seller" is a wholesaler, looking for a flipper-wannabe to whom $10k seems magical... 

When you got your list back from listsource did you have to find the property owner’s mailing address by cross referencing county tax records or is there some easier way? 

Then you walk tax free.