I've been audited by the IRS several times.

Audit trails are set to discover such activities.The other issue is folks getting "gift funds" mixed up with a "gift", nothing wrong with a gift given to you and explained as opposed a gift to buy a property, strings are attached, the gift is for this use.

More detailed overview coming soon, but some quick details...When: rules become effective in 60 days.What: There are 2 "tiers"Tier 1 - requires SEC and state blue sky reviews & fees, raise up to $20M per year, open to unaccredited investors, no audit requiredTier 2 - requires SEC review but no state blue-sky review ("preemption"), raise up to $50M per year, also open to unaccredited investors (limited to the greater of 10% of income or net worth), annual audit required, must use a registered transfer agent (FundAmerica will be helping to simplify this for issuers)Both - are open to unaccredited investors, can be used by startups as well as existing businesses, and are exempt from 12(g) registration thresholdsHow: Preprare offering doc's, get your audit done, use "form 8a short-form", submit draft offering to SEC, filing electronically via EDGARCompare to 506(c) - takes way more time to launch an offering, and far more costly in terms of legal fees, accounting costs, and annual reporting obligations.

Have you looked into a Loan Audit?

That could helpful just to do your taxes and have records for an audit...sounds like the details for documenting could be better....Liability wise and for employee taxation issues, you can find some rules both the irs uses (search employee versus independent contractor on the IRS site) and your states outline of the distinction related to liability will probably be similar but may also focus on factors like whether you are controlling the means or just the ends (telling them the outcome is okay but not the exact means)...are you a client/customer or supervisor here?

How to audit information that sellers lie about, Realtors mistakenly provide and Bankers overlook.

If you are the only client, you are an employer.Now if you are not worried about an audit then I would be concerned with what type of work they are going to be doing?

Then I would wait for my audit notice(would be my 3rd) win the audit and then write my 3rd book " How I beat the IRS at their own game"" Damn Lenders.

In my personal opinion, 24 months is a very conservative hold time because it straddles three tax years and if audited, you can clearly show your intent to hold.

JV agreements with LLCs gives the best protection and helps keep your books separated in case of an audit.