Most Americans have realized good appreciation in their home values from 2008 – 2018. With an IRS exclusion of $250,000 per person and $500,000 per couple, they can realize a handsome profit after two or more years of owning and residing in that home.
There is rarely a single person behind any wealth management strategy, and a Deferred Sales Trust is no different.
A DST has two beneficial uses: First, it allows you to structure an asset sale to defer the capital gains tax payments indefinitely. Second, it provides a vehicle for you to invest the full proceeds to best suit your financial and lifestyle objectives.
The deferred sales trust (DST) is a tax strategy that builds on the installment sale concept explained and regulated by Section 453 of the Internal Revenue Code. For nearly a century, this process has provided sellers with capital gains tax relief if they do not receive full payment for an asset at the time of the sale.
Actually, there is only one reason why anyone should defer capital gains taxes: more money.
Capital gains taxes often reduce profits by 40% or more. Finding ways to defer taxes and invest the excess is one of the ways that the 1% continues to build astronomical wealth.