As a Certified Public Accountant, you deal with your clients’ complicated financial issues on a daily basis. These usually involve tax issues and can be quite challenging, particularly as tax laws, rules and regulations continue to change.
Deferred Sales Trust
Setting the Repayment Terms of Your DST Installment Sale Note
As a savvy investor, you likely already know that Section 453 of the Internal Revenue Code authorizes you to utilize the installment sale method when you sell a highly appreciated assets so as to obtain favorable capital gains treatment. What you may not know, however, is that when you utilize the Deferred Sale Trust rather than a regular installment sale, this legal, safe and proprietary tax strategy gives you many additional benefits.
Who the DST is Not For
You have probably read several blogs and other information on this site that extol the benefits of utilizing the Deferred Sales Trust when selling your highly appreciated assets. You may be considering its use yourself in one of your upcoming sales. Before proceeding further with your thinking process, however, you should know that the DST is not for everyone or for every sale transaction.
What is an Installment Sale?
The Internal Revenue Service defines an installment sale as one in which “you’ll receive at least one payment after the tax year in which the sale occurs.”
Webinar Replay: Capital Gains Worries? Learn How to Create an Exit Strategy and Wealth Plan with Two Deferred Sales Trust™ Solutions
One of the most intriguing features of the Deferred Sales Trust is the ability to combine both of our two main structures to both defer the capital gains taxes, and to position assets that generate a lifetime income for you and then pass your growing underlying principal to your designated heirs OUTSIDE of your taxable estate (e.g. Not subject to the 40% + estate tax). This combination is what we refer to as the DST Plus.