It would show up in the seller disclosures and title report.Secondly, I agree with @Jeff Copeland's interpretation of the language your neighbor is scaring you with.  

Yes, it can, but it depends on how your CPA interprets the tax code.  

That is not my "interpretation"...the statute is clear.

I incorrectly interpreted that you had just discovered "market" cap rate in general...

They are so new that the IRS is just establishing guidance for interpretation/application of the rules based on the new laws that created them.

The law is often unclear and is interpreted differently from jurisdiction to jurisdiction.

There is something called "normal wear and tear" and though it is up for interpretation, I suspect most judges would not be on your side if you expected your tenants to live with nothing on the walls and not a scuff on a baseboard.

Additionally, there shall be not less than eight thousand square feet of site area for a lot having three dwelling units, and each dwelling unit, in excess of three, shall have an additional three thousand square feet of site area per unit.From what I am interpreting from this (I am not familiar with Inglewood zoning, so this may be incorrect), you must allocate 2,500sqft of land per unit.Your property is only 4,914 square feet.

I'm not sure after re-reading it what he is asking so maybe we are talking about two different interpretations of his post. 

Future I would interpret to mean just that.