"While exploring the fence situation I also explored the driveway with no easement situation and decided to implement a fee to help me cover the taxes and maintenance of the section of my parcel that is paved and dedicated for your use as a driveway."

I'm not sure what you mean by type of income tax basis, but ideally, both my parents and us would have the lowest tax basis possible?

I heard that this can be beneficial for the seller cause it can help them avoid tax obligations.

I just had my annual appt with my tax guy and he advised now is a HORRIBLE time to get into real estate and that I'm better off in stocks.

So I recently learned that some states don't have any income tax.  

But the prohibition is that you cannot buy from related parties when the intent is to lessen your tax burden. 

Is there any way to avoid these taxes?

Feel free to ask the BP Forum your tax question. 

With 1031 Exchange you are not paying any taxes.

Yes there will be payroll expense and tax return fee, but in the end it is beneficial.