Depreciation Recapture in Seller Financed Transaction

[Robert McEachern]

Hello All:

I am trying to purchase a 4-plex using seller financing and the Seller's accountant is telling the Seller that they need to receive enough of a down payment to cover the depreciation recapture which is taxable in the year of the sale.  Is this true?  I have never heard of this.  Is there a way for the seller to somehow defer that tax?

For reference, the terms of the transaction are:  $0 down and monthly interest only payments at 6% with the balance due in 7 years.

Thank you in advance for your help.

Rob