Personal use, mixed-use items, or home office mistakes are common pitfalls.Retirement or education credits: These are often oversimplified on social media, and claiming them incorrectly can lead to huge penalties.The IRS has sophisticated systems to catch improper claims, and relying on viral tips instead of professional guidance can be very costly.

However, if you normally would owe the IRS $5k, then the $12k tax savings will first pay the $5k shortage, and only the remaining $7k is your refund.

🎉 The trust account and owner payment side of things can feel tricky at first, but once you have the right system in place it really streamlines operations.I’d be happy to hop on a quick call and share what’s worked well for us.

If you’re open, I’d enjoy hopping on a call or video chat to learn more about how you’re scaling this in Chicagoland / vicinity.

I understand your template follows the IRS ATGs, which sounds helpful.

Quote from @Brady Ascheman: Hi everyone, when meeting with my CPA recently I was instructed by here that if you obtain "Real Estate Professional Status" as per the IRS rules then your rental income become "active" instead of "passive" income in the eyes of the IRS.

For simplicity, lets pretend that I have no income from any sources...Could the IRS then still tax the conversion because I am converting 400, 500, 600K?

Correct, but according to the IRS Publication 5653 Cost Segregation Audit Technique Guide this IRS prefers an “onsite” visit.

Would reporting him to IRS and SEC make matters better or worse?

You should have:1) Involved an attorney when seller disclosed IRS liens.2) Required seller to supply copies of their IRS communications as a condition to extend contract.3) Required seller to reimburse you for your inspection costs to extend contract4) Required seller to reimburse you for your appraisal expence to get a copy of it.5) Never tried to rent out the property given the IRS lien and NO ONE ELSE but seller knowing what's going on with the IRS release!