I was living out of the state at the time so I made a visit to the properties and arranged to have my father, a CPA, come and do an audit of their books for my account at the property management company. 

Hi Steve,It also comes down to comfort levels of whether you like to micro or macro manage your funding pools as well as your own personal financial auditing style.You also need to keep legality in mind as to whether the property is setup under a personal or corporate entity in order to protect yourself or your personal assets etc. 

IRS Audited?

Otherwise, in the event of an audit, you will have no proof of their status and they may be difficult to contact then.

If sellers provide financials you want independently audited financials by an outside party.

Imagine what a tax audit would look like?

Typically, selling in your parent's name and buying in your LLC, under audit, may result in a disqualified exchange.

Two problems with this outcome:major audit flag on zero-income Sch Cinstallment income improperly escapes SE taxMy solution is to manually calculate installment income and enter it on Sch C, forgoing 6252. 

The company account also separates your personal assets if you were sued or audited.

@Max Tanenbaum  Don't you need receipts on file in case of an audit or will the bank statements work for the IRS?