1031 Exchange Audit Review

Somewhere in your exchange history, there may be money you never claimed. Not from a loophole. From your own buildings. Depreciation you were entitled to — that no one ever captured. If you've traded up over a long investing career, the building you own today is the end of a chain. Three, maybe four properties back — each sale rolled into the next through a 1031 exchange. And at every link in that chain, someone decided what was building and what was land. Here's the part most owners never hear. Your CPAs probably filed everything correctly. The forms were right. But correctly filed is not the same as correctly valued. The building-land split, the fastest depreciation the law allows — that's top-shelf advice. Over a twenty-year chain of exchanges, almost no one gets it at every link. A Texas couple. Twenty-plus years of exchanges. Two CPAs along the way. On their current property, the most recent CPA allocated roughly twenty percent to the building — and eighty percent to land. Land doesn't depreciate. Buildings do. They had been under-depreciating for years. So the properties were re-appraised. The correct allocation was applied. One filing was made. The result: over 1.2 million dollars in new tax benefit. Money that had been sitting trapped the whole time. The recovery runs through a form the IRS already allows: Form 3115, a change in accounting method. No amending old returns. Every missed year comes forward in one adjustment — the section 481(a) catch-up — onto this year's return. We follow the exchange records back to the true basis. Then we bring the money home. And it doesn't have to happen all at once. Several properties, corrections sequenced across the years you need the deductions most. Even the building someone told you was a few years old — too late. Usually, it isn't. Whether you've done one exchange — or four — the question isn't whether the forms were filed. It's whether the money was found. Start with a no-cost fit review. jamiepope.com — JPOPE Tax Consultancy. We prepare. Your CPA signs. Taxpayer first. Then the property.

© 2026 JPOPE Tax Consultancy. Screening estimate — not tax advice.