The cap is already so low that in a down turn property taxes go up, insurance goes up, tenants do not reimburse like commercial NNN so it eats into owners returns.

Additionally the seller could own many properties and have a master insurance policy at a much cheaper rate than what you can get owning a single property.Unlike in commercial retail NNN where the tenants reimburse for property taxes and other costs with a residential rental the landlord is basically getting gross rent so how well the owner controls costs heavily affects the bottom line.Landlord paid utilities for residential is another one you want to stay away from.

I could ask the seller to pay for it and reimburse her at closing.Any ideas on how to give this seller a recommended price that we can both have confidence in?

If you do decide to take on the current owner's problem, make sure you are very well compensated with a sizable price reduction to reimburse you for the time, expense, risk, and headache of evicting them yourself, however I would not advise going this route.

As far as college goes. what I recommend to parents, in order for them to not feel resentful towards a child that may not be as motivated as the parent wants them to be, is to reimburse the child for their grades.

Any games you played with "renting" to yourself are null and void and you are now responsible for reimbursing uncle same for any unpaid taxes plus penalties - plus they're going to go thru the rest of your stuff with a fine toothed comb.That being said, there was always a big advantage to having your home count as your primary residence anyway - you could sell it and not pay any taxes on the profit (deferred or otherwise).But now that they limited the SALT deductions, that may change. 

The rehab costs get rolled into the original loan and reimbursed out of escrow as the rehab is completed.

The resident actually paid us first and then was reimbursed by the previous landlord.

Now, does the landlord need to reimburse the tenant for the whole or partial if any???

Your sweat equity reimbursement should come from positive cash flow only.