The Risks and Disadvantages of a 1031 Exchange – And How the DST Can Eliminate Them | Reef Point

The Risks and Disadvantages of a 1031 Exchange – And How the DST Can Eliminate Them

If you have invested in real estate in the past, you likely have also done a 1031 exchange. As you undoubtedly learned, however, 1031s have numerous risks and disadvantages. While they defer your capital gains tax liability when you sell a piece of appreciated real estate, the rules and regulations that apply to them can make them unappealing at best and downright dangerous at worst. Why? Because they often fail, leaving you with an enormous capital gains tax to pay.

Two Scenarios in Which the DST Made an Excellent Real Estate Exit Strategy | Reef Point LLC

Two Scenarios in Which the DST Made an Excellent Real Estate Exit Strategy

If you invest in real estate, you likely have heard about Deferred Sales Trusts (DSTs), the innovative, legal and proven method of selling investment real estate that allows you to defer payment of capital gains taxes while offering you almost total flexibility in your investment choices. But have you ever considered the DST as a real estate exit strategy?

A Complete Guide to the DST | Reef Point LLC

A Complete Guide to the DST

Despite the fact that savvy investors have been making use of the Deferred Sales Trust (DST) for over 20 years, you may not have heard about this legal, tested and innovative way to defer capital gains tax liability when you sell a highly appreciated home, business or piece of commercial real estate. If not, we at Reef Point are happy – and proud – to present this Complete Guide to the DST.

Will a Bifurcated 1031 Exchange Achieve Your Investment Goals – Part 1 | Reefpoint LLC

Will a Bifurcated 1031 Exchange Achieve Your Investment Goals – Part 1

Today we begin a new 2-part series on one of the most innovative ways in which to do a 1031 exchange: bifurcation with a Deferred Sales Trust (DST). In Part 1, we’ll explain how a bifurcation works. In Part 2, we’ll explain an alternative you may wish to consider. As you likely already know, Internal …

Read moreWill a Bifurcated 1031 Exchange Achieve Your Investment Goals – Part 1

How Are DST Funds Protected? | Reefpoint LLC

How Are Deferred Sales Trust Funds Protected?

In previous articles we discussed how the Deferred Sales Trust (DST) is a specialized form of installment sale authorized by Section 453 of the Internal Revenue Code. In a DST Trust installment sale, the entire course of the transaction and its continued operation revolves around a secured installment note in favor of you, the seller. In this context, “secured” means that all of the assets in the DST serve as collateral, i.e., security, for repayment of money to you per the note’s terms.