Issue is we have the JV partner and they would like to be part of the ownership if we long term hold.

Is there a timing issue with your state's laws? 

Is it legal?

Is this legally allowed?

With the newly passed lead laws, the state seems to be getting much more strict about demanding landlords have a Certificate of Conformance for lead based paint issues on both the inside and outside of the house.

@Kevin Luttrell oh, and I think the issue may be that since pretty much all accountants/preparers use a tax software, they follow whatever the software does.

Intra-tenant issues can be more since they live so close to one another.

See what issues they may have and how you can solve it.

However, I am having issues finding a good area with good growth at a good price. 

When that happens there is NOTHING you can do in the short term to resolve those issues.