You can allocate any tax benefit, I'd say you can do it, just be very clear about the allocation in your agreement. 

Here's the reader's digest version:They do not have a written agreement (and at this point cannot agree on one)She wants to sell, he does not (he is not on the mortgage but is on the title)Tenants that were month to month are moving at the end of the month, no rental listing existsTo get the property, he put up a down payment (over $50k), and she secured the mortgageWhat he wants in a buyout or sale is unreasonable (after lawyer review), and even though they still cannot agree on a partnership agreement, he wants to list the rental and get tenants in ASAP.

Even if you get lucky right out of the gate and have a listing or a preapproved buyer ready to go, and you go under agreement at the first showing, it could take 45 days to close and a few days to get paid.

You could look at your deal and maybe restructure the agreement to count it as "Rent" vs something else, and potentially pay it directly to the seller, or Brokerage, and ask them to put up the Earnest deposit for you.  

Removing a verbal-agreement tenant can be very difficult - basically in this case the courts favor the tenants word over owner/landlord on almost everything if the tenant won't cooperate.  

Plus they’re big enough to hire a PM to manage and take the day to day off your plate.To give you an example We just helped a Househacker in east Boston, who is looking to scale, put a 6 unit in Leominster under agreement at around $85k per unit.

Therefore, he gave me notice through a text that he wanted to terminate the lease agreement. 

Can anyone recommend the best e-sign lease document for Massachusetts?

Following.If you find out there is a lawsuit in the mix I would really like to see what other steps could be taken to come to a mutually agreement on the property if any. 

This is where I get confused - I think there may have been some type of verbal agreement between my realtor and her's that I'd take care of any simple/obvious repairs if we could get this over the finish line.