So, you want to live the good life. Who doesn’t? You’ll be happy to hear that it’s possible to live a luxurious lifestyle even if you don’t have huge amounts of cash. All you have to do is invest in a Delaware Statutory Trust. What is that, anyway? A Delaware Statutory Trust, DST for short, is a type of real estate ownership that allows individuals like you to buy property. Undivided interests are conferred to several investors, so there are no liabilities regarding the asset. You aren’t responsible for managing the DST or the real estate property, so there is nothing to worry about. More and more investors are choosing to address the challenges of 1031 exchanges through the Delaware Statutory Trust. Please continue reading to find out more.
Getting a good understanding of the Delaware Statutory Trust
The DST is a legal entity that is set up for taxation purposes under the Delaware law. This product is aimed at investors, helping them avoid paying taxes. If you own one or two properties, that means a lot of money. When you try to sell the assets for profit, you have to pay capital gains tax. Or not. You have the option to defer income tax and diversify your real estate portfolio. Opt for the 1031 DST exchange. The Delaware Statutory Trust fulfills the requirements of Section 1031 of the IRC. Since it qualifies as a replacement property, you can complete the transaction and eliminate the financial burden. Put simply, you acquire beneficial interest of large real estate.
Types of 1031 DST properties available
There are various types of 1031 DST properties available that you can hold as an investment. Examples include but aren’t limited to medical properties, apartment buildings, and leased retail. Other types of real estate that are available to investors are shopping centers, self-storage facilities, warehouses, government leased buildings, and so on and so forth. Generally speaking, you have access to different Delaware Statutory Trust properties from the sponsor companies within the industry. No matter what requirements you may have, there is an asset out there that you will like.
Making money in real estate with DST and 1031 exchange
If you have ever had an investment property, such as a rental home, then chances are that you know what a 1031 exchange it. Just to refresh your memory, it is an exchange that enables you to reinvest your proceeds into new property. Basically, you do not have to pay tax on gain at the time of the sale. The best way to take advantage of this investment vehicle is through the DST. The Delaware Statutory Trust makes it possible for you to enjoy ownership without management headaches. You would be a fool not to take advantage of DST investing. When it comes to DST transactions, you have to pay attention to the fact that once the deal is closed, the terms can’t be renegotiated. The only types of exchanges that work are leases for commercial projects. Is that understood?