Add that to your documentation.If illegal drugs are involved, it might be worth your time to contact your local law enforcement.

@Logan Allec I guess I am just looking for a perfect fit instead of just making it fit.

It's called a casualty loss, and those rules got more complicated with the new tax bill, you'll need to speak with a CPA to find out how it'll fit your exact circumstances because generally the casualty loss deduction went away in 2018.

Regardless, I would NEVER involve the insurance company unless there was significant damage to the house. 

@Felix L PerezIt is okay if you are not proficient in tax - you can easily hire a tax accountant to help you.I am not good at plumbing and I would never dare to try to fix my plumbing issues.If you are involved in a flip that you acquired the property in 2018 - there won't be any benefit that you can use to do on your 2017 return.Expenses that are ordinary and necessary are deductible.

The triplex was recently renovated and fitted to meet the needs of this type of property. 

You are trying to win the deal based on your own self maximizing interest without regard to what the sellers actually need and the tools to fit the scenario.Second, if you really want to make a seller financed offer, why offer an optional ballon at $270,000?

I'm an Ex-NFL athlete (currently a Free Agent) that's looking for the next step after my football career and I think REI will be the perfect fit.  

This is a more complicated strategy that involves the use of a non-recourse loan for the IRA, as you may not pledge a personal guarantee. 

What are the other cost involved beside the development cost.Any help would be appreciatedThanks