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A Quick Guide: How the DST Can Benefit Your Clients

Reef Point LLC · August 10, 2021 ·

A Quick Guide - How the DST Can Benefit Your Clients | Reef Point LLC

If you’re a legal or financial professional who caters to a high-asset clientele, you should consider becoming a Deferred Sales Trust (DST) business partner. Why? Because the DST offers your clients numerous benefits when they sell their highly appreciated assets, including the following:

  • Single-family residence
  • Rental property
  • Condominium
  • Apartment units
  • Commercial property
  • Industrial property
  • Second home
  • Raw land
  • A business
  • High-value collectable such as art, classic cars, sports memorabilia, gems, etc.

Capital Gains Tax Deferral

First and foremost, a DST saves your clients payment of what could potentially be a long-term capital gains tax high enough to eat up over half of their sales proceeds. It does this by having your client sell his or her asset to the DST instead of directly to the designated buyer. In exchange, your client receives a secured installment sale note that qualifies for capital gains tax deferral under Internal Revenue Code Section 453. The DST’s Reef Point Independent Certified DST Trustee, one of only 13 in the nation, then sells the asset to the intended buyer. Since the sale proceeds come into the trust instead of going directly to your client, he or she has neither actual nor constructive receipt of them, thus avoiding an immediate capital gains tax hit.

Additional Benefits

But that’s just the beginning. Additional DST benefits to your client include:

  • Diversified collateral
  • Investment flexibility
  • Seller/Taxpayer protections
  • Higher, stable cash flow

Your client can instruct the Trustee to make any type of “bonafide investment” desired. For instance, common DST investments include:

  • Stocks
  • Bonds
  • ETF’s
  • Annuities
  • Mutual funds
  • REIT’s
  • Green energy funds

If your client is already involved in a 1031 exchange, switching to a DST can eliminate the rigid rules and short deadline times inherent in 1031 exchanges. It also provides an excellent backup strategy in the event the 1031 exchange fails. Furthermore, a DST gives your client a depreciation basis reset in the event he or she ultimately reinvests in upside real estate.

Safe, Legal, Tested and Proven

You may rest assured that the Estate Planning Team, LLC, that offers the proprietary DST takes your clients’ safety as seriously as you do. In the 25 years of its existence, the DST has undergone several IRS audits and reviews by independent agencies. Not once has any of these resulted in an adverse ruling or opinion. In other words, the DST boasts a perfect legal and tax-compliant record.

In addition, the Campbell Law Firm, creator of the DST, offers your client free legal representation in the event his or her particular DST is ever challanged in federal or state court or audited by the IRS.

Potential DST Business Partners

If you work as one of the following professionals, you can achieve a competitive edge by becoming a DST business partner:

  • Tax attorney
  • Investment or financial advisor
  • Realtor
  • Business broker
  • Mergers and acquisitions professional

Your ability to offer your clients this unique tax and estate planning strategy can only help you grow your business or professional practice.

Schedule a Free Consultation

Anxious to get started increasing your own revenues by offering the DST to your clients? Schedule a free Reef Point consultation today.

Deferred Sales Trust Attorney, Client, Deferred Sales Trust, Financial Advisor, Real Estate, Reef Point

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Reef Point LLC was founded by Gregory H. Reese who is one of only 13 Trustees in the US for Deferred Sales Trusts.

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714-581-5376
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As an authorized and approved Trustee for the Deferred Sales Trust and Member of the Estate Planning Team (EPT), Reef Point, LLC promotes the use of the Deferred Sales Trust™ or other estate planning techniques and is not responsible for recommendations made by other members of the Estate Planning Team, including the Deferred Sales Trust or other tax, legal or estate planning strategies.

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