I wonder if they separated the utilities, if you feel their was something fishy going on, contact your utility company and share your concerns and ask if they can do an audit and see where the utilities are and who is responsible for what.

. - We helped the client with an action plan to streamline their process, put audit trail in place, create a workflow, implemented a procedure where each employee was delegated one step of the process (without the other person knowing that they were been internally audited), and customizing reports and in the end we were hired in being a part time CFO- They still accept cash, barter, money order, ACH, credit card no Bitcon yet.

I seem to remember her saying something like home office expenditure is an audit red flag as well.

We hired a Six Sigma Blackbelt systems guy to perform regular audits of turnkey providers to make sure they continue to meet our very high standards.Be sure to speak with one of our investment counselors as well to get the inside scoop!

Are you auditing financial statements or something else?

If the IRS or state audit team could prove that you really had the intent to live in half all along they can disqualify your 1031 Exchange. 

HI David,Technically with the interest tracing rules, the interest should be deducted on Schedule E (against your rental property) regardless of which house actually is being used to secure the loan.If you are ever audited, an IRS agent might try to argue that the mortgage interest should be deducted on Schedule A if you secured the loan with your principal residence, so make sure you keep good documentation proving that you used the funds to purchase a rental.

For anyone who reads this and looking for the info, it cost $100 for the audit which goes towards to cost of your project.  

With this method, we can be confident that our conclusions are based on thorough research and impartial analysis.

If your return is audited and if the exchange is questioned the field agent may question you and it will be your responsibility to demonstrate what your intent was.