Quote from @Gian Pazzia: For properties that small, you should budget $450 per property and use cost segregation software like the one below from a trusted brand that has been in business almost 25 years.

Though it might “seem” that you can arbitrarily attach the “tax basis as the fair market value” and thus receive $0 gain, the IRS would not respect this if you were selected for audit.

So these platforms will be looking to teach people how to source deals,  use their experience and soft ware etc.   

A few people have contacted me and asked me what I would want in software for tax lien investing.

I found a software program that is fantastic.

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IRS audits and penalties: Studies that are poorly conducted may be full of unsubstantiated assumptions and errors that can lead to expensive audits and large financial penalties from the IRS.Long-term issues: Dealing with IRS audits and having to correct inaccurate studies can be a drawn-out, stressful and expensive process.

The software my accountant is using is writing off these losses against my W-2 income which is telling me I am entitled to a refund. 

Loans are almost always used as proof of correct "investment intent" under an audit scenario. 

Are there any  good softwares that can be used for this?