passive investments for 1031 exchange investors
Investing in
Delaware Statutory Trusts (DSTs)
passive investments for 1031 exchange investors
Investing in
Delaware Statutory Trusts (DSTs)
webinars
coming soon
Join Ashley Romiti as she discusses the 1031 exchange process and potential benefits of using Delaware Statutory Trusts to satisfy 1031 replacement property requirements.
What is a 1031 Exchange?
A 1031-exchange is a tax-deferred exchange. It represents a simple, strategic method for selling one property and exchanging it for one or more like-kind properties within a specific time frame. To qualify for your exchange, you must follow a few simple rules to ensure your exchange is both tax-deferred and compliant under Internal Revenue Code 1031.
What is a DST?
A Delaware Statutory Trust, or DST, is a legally recognized real estate investment trust in which investors can purchase ownership interest. Investors who own fractional ownership are known as beneficiaries of the trust – they are considered passive investors.
DSTs qualify for a 1031-exchange.
Why consider investing in DSTs?
1031 Exchange Qualifier
With a Delaware Statutory Trust as a 1031 replacement property, you select the exact undivided interest that meets the financial requirements of your exchange.
Deferred Capital Gains
As a 1031 qualifier, a DST can be used by investors to transfer their investment capital while deferring the payment of capital gains on their initial investment.
Institutional Quality Properties
Investing in a DST offers investors access to institutional quality assets, which often have the potential to deliver higher returns.
Diversification
The selection of property types and geographical locations opens a whole new level of portfolio diversification.
Passive Income Potential
Investors have the possibility of receiving monthly returns, offering a chance for stable cash flow through the life of their investment. Returns can fluctuate based on market conditions.
Management Free
All Delaware Statutory Trust properties are professionally managed for you. Investors take on no additional responsibility when they invest in a DST.
Limited Liability
A DST is structured so that investors are protected from personal liabilities beyond the amount of their investment.
Excellent Financing
DST sponsors are established investment real estate firms with strong lender relationships, allowing them to obtain very favorable terms for their clients.
Debt Obligation Management
When exchanging into a DST, you determine how much you want to invest and how much debt you want the DST sponsor to assign to you.
1031 In and Out
Since the IRS qualifies DSTs for 1031 exchange purposes, you can exchange out of it when it comes time to sell, and you’ll keep deferring taxes.
Estate Planning
DSTs offer investors unique strategies for estate planning. Upon the investor’s death, estate beneficiaries receive a stepped-up basis for tax purposes.