IRS Audit Defense

Landlords and Rental Property Owners are the Latest Target of IRS Audits

Over the past few years the IRS and states have drastically increased audits relating to rental real estate and other passive activities.  The Treasury Inspector General issued a report urging more audits of tax returns that report losses from rental real estate and other passive activities. The report follows a Government Accountability office study in 2008 that found most taxpayers with rental real estate misreported their income and deductions.

The IRS plans to audit more landlords and others claiming losses from rental real estate. In addition to increased audits, the IRS plans on asking for more information on future returns.

The tax rules related to passive activities are not well understood by the tax preparation community or by the IRS.  We know the rules and have a successful record in defending taxpayers.  We know passive activity law.  If you have been selected for IRS audit you owe it to yourself to get the best defense.

What does this mean for those claiming real estate rental losses? Expect more paperwork and an increased chance of being audited.  If you believe that there might be problems with your returns, contact us.

We specialize in providing audit defense against IRS and state taxing authorities.  

For general IRS audit information click here.

For a more detailed discussion of the passive activity rules click here.