According to a release last week by the Government Accountability Office, at least an estimated 53% of individual taxpayers with rental real estate misreported their rental real estate activities for the period examined.
The report concludes that significant obstacles are standing in the way of improving tax compliance by owners or rental real estate and cites that the fact that taxpayers may not fully understand the complex rules governing the reporting of rental real estate activities.
Opportunities that the government sees to improve compliance by individual taxpayers include improving existing information reporting requirements and requiring taxpayers to provide a greater detail of information on their tax returns.
Many of our clients own rental real estate and will be effected by any additional administrative tasks that they must perform in order to stay in compliance. We will keep you up to date if any of these recommendations actually become a requirement.
You can read the full government report here.