We wanted to buy this property for the cash flow, not a charity handout.My realtor advise me to think about the decision for a few days as we both want this sale to go smoothly as the seller has had cold feet before.We live out of state but go to the area about once a month to see family.What you do in this situation?

Are you running a business or a charity? 

They're complicated to structure and in the end whatever remains in the trust goes to a charity, hence the name.

They did not buy them as an investment (they bought them to rent to some people that needed a place to live from a charity they are involved in - kind of a weird situation), but it opened my eyes to the opportunities there.  

Speak to him about raising the rent to $850 and allow him a couple of month to find another place to live while you seek a replacement tenant that can afford the unit and that will not be a financial burden on your investment.Now is the best time for you to decide if you are investing as a business or as a charity.

Your parents can afford to pay the tax gain now, let them do that and watch you develop and make something of it while their still alive, tell them you want them to see what can be done, and if you need more $$$ ask them down the road to do more.Trusts are good way to avoid probate, and make other choices but they can be dragged out and if your not the one calling the shots as the trustee the one that manages the trust after they are gone then LIMBO is the game.Example at gift to beneficiary a charity was set at % amount.. what has to happen is a complete disclosure of assets, done by accountant, submitted by trust attorney to the beneficiary attorney so they can accept or ask for more detail on the accounting summary.. long and short of it.. more costs to the trust..

This situation is going  to be a downward spiral and unless you are intending to operate as a charity it is time to cut your loses and find a new tenant.

When I started with a secured card it was only a $200 limit, so I set up a $5/month donation to a charity and set up auto pay so I never had to think about it, and never even carried the card.

Imho the problem with these situations is that once they fall behind, these tenants start digging a hole for themselves that they will not be able to get out...unfortunately.If you want to be nice, tell them that you give them a week to move, otherwise serve the notice and start the process....unless you're running a charity.

But I am fairly certain it doesn't work like that in any instance since they are not providing to a charity/non-profit.Now if you are talking about funds to use on your next home purchase, then no it cannot be counted as a gift.