Again, technically per the IRS from what I understand is a sale BUT if everything was documented correctly and the intention was to always keep it in that LLC then if audited and fought you'd most likely be ok.With that said, if you're not doing refi's in conventional any longer and strictly portfolio or asset based lenders then MOST LIKELY there would be no need to have in your personal name and clearly safer to have under an LLC if formed correctly.

It reduces fraud.When you get audited by the IRS, they want to know how much you paid for a property, how much underlying debt the property had and whether you had a responsibility to make the payments, making you eligible for taking the interest deduction.Subject To is not illegal.

They didn't make money on their monthly cash flow if we were to audit it-- they made it on the realized value in that 20-22 time frame. 

Many investors make good money, but they are miserable.There are several serious assets a person should have before they jump into real estate investing such as:a) enough cash to handle the unexpected repairs, vacancies, tenants who don't pay rent and legal costs,b) enough math skills and many other experiences about properties to understand whether or not the purchase of a property will result in a profit,c) enough math skills to calculate your profit at the end of every year and this includes understanding enough math to calculate your profits from depreciation, rent income, rent increases, property appreciation and increased property value that results from rent increases e.g. using the Gross Multiplier.d) the mental maturity and skills it takes to deal with tenants who, who destroy your property, don't pay their rent and then to deal with evictions and attorneys without getting stressed and going insane.e) be knowledgeable about real estate rent laws andf) ability to produce accurate bookkeeping records for banks annual audit and the IRS audits.So, when many people ask if the real estate business is good to get into I don't think it is right to just tell people, "'Anyone Can Do It".

I just thought that doing 1 action like a HELOC payment for the exact amount of the loan would be the quickest and easiest thing to do if I were to able to get audited, because I can easily show where the money went.

As you know, the IRS Cost Segregation Audit Techniques Guide provides information regarding the specialization, methodologies, and frameworks one Cost Segregation Preparer should have in order to provide an accurate qualified study.  

Each state has a Division of Real Estate who oversees broker operations & requires broker's to adhere to incredibly strict accounting procedures, audits and care of all of this money that flows in & out of their hands that is that of the client's (you) or the tenant's.

Therefore, the risk of an audit for taking a Vivid-19 hardship withdrawal from a retirement plan should be very low. 

You may get audited and the IRS may call a foul and hit you with a claim for the capital gains. 

One that covers you at no cost if you are EVER audited.