In a seller finance does seller pay more capital taxes or ordinary taxes or both if they dont do seller finance?

I agree with Jason, but you might be paying SE taxes on top of ordinary taxes as ordinary income( not short term capital gains). 

Was looking at a small multifamily property locally where the seller had quoted this policy to substitute his ordinary maintenance expenses when I asked for his P&L on the property.

Way the worksheet is laid out, it will pull the applicable number to determine what bracket your capital gain will be taxed depending on your ordinary income level. 

If the IRS determines that your intent during the year was always primarily to resell (think like a long rehab and flip) then they can call the gain ordinary income and you would pay regular income fed and state plus maybe self-employment plus maybe the ACA surcharge - It adds up tremendously. 

If you plan to fix&flip then it will be taxed at your ordinary income rate.

And perhaps somebody can jump in to verify but I believe everything I've earned from Fundrise is taxed at the ordinary income tax rate whereas I'm showing massive paper losses on my passive investment due to accelerated depreciation.

I just found the financing a bit out of the ordinary and wondered why.

That's interesting I will run that by my CPA  .. loaning money is ordinary income the tax deferment at least what I read is for dividends and cap gains.. did not see anything about getting out of ordinary income or self employement tax.. 

After purchase, self rehabbed by:painting the whole house, brand new floors downstairs with modern baseboards, modern appliances, brand new concrete patio, all led lighting throughout the house, new cabinets and counters in both bathroom and kitchen downstairs.