The settlement statement of the title/escrow and mortgage lenders are subject to audits. 

Most 1031 Exchange experts and advisors recommend you hold property for at least 12 months to clearly demonstrate your intent to hold for investment purposes, although a number of IRS Rulings have alluded to 24 months.Holding your rental, investment, or business use property for less than 12 months does not mean that your 1031 Exchange will be disqualified, but it might be significantly more difficult to prove your intent to hold for investment purposes in the event of an audit.

A full-time tax preparer would have instantly recognized that this form would have been needed.As the complexity of your business increases, so does the risk of audit.

You can do a lease audit to recreate the income but many times the seller would have you believe that the T3 accurately reflects expenses. i would rebuild my expenses by getting copies of annual utility bills, insurance, taxes, and service agreements.

ALSO, make sure to check in with MassSave for an energy audit and what freebies/discounts they have.

Department of the Treasury to represent taxpayers before all administrative levels of the Internal Revenue Service for audits, collections, and appeals.What does the term “Enrolled Agent†mean?

You can put it on the market like on 10th and wait to close 1 year after previous COE to take advantage of long term capital gain. the likely hood getting audited in way higher vs if you are waged year after year.

BUT I agree that entities for proper IRS tax regs is a real issue and great reasons to use S corps and multi member pass throughs to have rental houses show up on K-1's instead of Schedule E's (higher audit risk down on your 1040 / sched E's vs keeping rentals up in the partnership return....)Best of luck.

Can we ask for a third party audit?

When he gets audited by the IRS and he will pulling stunts like this.