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.