The more complicated your business structure becomes, the more problems it can actually cause such as when looking for lending options, getting the best interest rate, keeping clean accounting, filing taxes, opening bank accounts, getting credit cards, executing a 1031, making title insurance claims or even triggering a due on sale clause, etc. 

Also, I know this status can sometimes trigger an audit.

I've been searching properties for a variety of ideas for almost two years now and never pulled the trigger.  

I'm just exploring, gaining knowledge and conducting research before I pull the trigger on anything.

For example; young professional may trigger higher demand for smaller units.

Handled improperly, it can cause serious injury. 

Just curious, what made you pull the trigger on the HELOC?

With a land trust, the legal ownership remains with the trust, helping to avoid triggering the DOS clause when transferring beneficial interest rather than title.

It would be tough to make the case that you work more hours than your property manager, which is my best guess (for someone who is not a tax professional) as to what triggered the audit. 

I think the question is whether you want to look like a threat to the police and other trigger happy wannabe vigilantes (yes, could be one of your tenants).