As a financial or legal professional, you’re always looking for ways to better help your clients. But not just any “way” will do. It must truly be of value to your clients. It must be legal, proven and tested. It must allow you to ethically practice within your rules of professional responsibility. It must be something you feel very good about yourself so you can responsibly advise your clients about it and recommend it to them.
Deferred Sales Trust
As you’ve likely already discovered, divesting yourself of substantially appreciated commercial real estate investments can be tricky at best. A straight sale exposes you to a huge long-term capital gains tax payment. A 1031 exchange has numerous rules and narrow time frames that can make it unfeasible. What to do?
Even though the Deferred Sales Trust has been available for more than 20 years, it’s still relatively unknown. If you’ve never heard of a DST, the most important thing you need to know about this unique, proprietary strategy is that it allows you to defer your capital gains taxes when you sell a highly appreciated asset. But that’s just the beginning of what a DST features and how it can benefit you.
If you’re an investor with a high tolerance for risk, you likely have invested in one or more digital currencies, i.e., cryptocurrencies, in the past decade or so. Bitcoin, the granddaddy of them all, only appeared in 2008. Today, however, you have over 6,700 different publicly traded cryptocurrencies to choose from. Their total value, as of Feb 18, 2021, was more than $1.6 trillion. On that date, Bitcoin alone was worth over $969.6 billion.
Given that most mergers and acquisitions involve a large company, you likely have many tax considerations when another company wishes to merge with yours or to acquire yours. One of your most pressing needs likely is a strategy whereby you can defer the capital gains you undoubtedly will face when your company merges with another company or agrees to be acquired by it. This is where a Deferred Sales Trust can save you hundreds of thousands of dollars in taxes while allowing you to diversify your overall investment portfolio.