The IRS has recently issued internal memos that appear to be focusing on increasing audits of rental real estate activities. The Treasury Inspector General for Tax Administration examined tax returns from 2001 and has found that many rental real estate owners are underreporting the taxable income from those activities. They are recommending an increase in the auditing of rental activities in the future.

Under a change in the IRS regulations, the IRS is allowing individuals to rollover Regular IRA's into Roth IRA's up until December 31, 2010. The conversions will cause the taxpayer to show the rollover amount as income and to be taxed on that income in 2010, or prorated 50% to 2011, and 50% to 2012. The change applies to all individuals regardless of their level of income. Previously, individuals were only allowed to convert their IRA's to Roth IRA's if their adjusted gross income was under $ 100,000.00.