I'm also hoping to get another property before the end of the year that won't have much time to bring in any income but will need the same outfitting.Going through this with the tax advisor last week, he strongly urged me to consider just carrying the losses forward, if I even had any, since they would be small compared to the cost of an audit and a one-time artifact of the startup processes.  

(No more than 1 min.)Use the the acx site to audition for books.

Any app will require some type of auditing....apps don't know if your trip is for business or personal usage...but they keep up with the milage for you. 

The accountant said my business (real estate)and the number of properties I have is just growing too fast to be handled in the fashion I was and to protect myself in the potential case of an audit I needed to take that step going forward.

Be prepared for a time commitment.IRS Scrutiny and Audits: Brace yourself; the IRS might start paying more attention to you.

I suspect one could ask for audited financials for each project ? 

With a nationally recognized CPA firm, annual audits and a reputable fund administrator, you would meet the minimum requirements for many investors.A strong CFO will not only bring financing expertise, but also strong risk management through adequate internal controls.

Tax professionals, including myself, already stated this fact on this very thread.I've become confused, not too hard to do for me and taxes.Today during my audit, by the nice man at the IRS (I filed an amended and requested a refund ;-) I am full time real estate with no W2 income.Anyway, he said "Since I am using a Non Passive Single Member LLC to buy properties, sell properties and manage rentals, I should be putting my properties on Sched C, subject to self employment tax instead of Sched E.

Plus, ask them how many audits they have been through.

Clients who, I am proud to say, have never once been audited due to the tax positions I've recommended to them.