D.S.T 1031 Exchange
A DST (Delaware Statutory Trust) 1031 exchange is a specific type of 1031 exchange that allows real estate investors to defer capital gains taxes by exchanging their ownership interest in a relinquished property for a beneficial interest in a Delaware Statutory Trust. DSTs are a popular vehicle for investors looking to participate in a 1031 exchange without the direct management responsibilities associated with owning and operating real estate.
Here are key features and considerations related to DST 1031 exchanges:
- Delaware Statutory Trust (DST):A DST is a legal entity created under Delaware law that allows multiple investors to pool their money to own fractional interests in real estate properties. The DST structure is commonly used for larger, institutional-quality properties.
- Passive Investment:
Diversification:
Income Generation:
Rules & Advantages
1031 Exchange Rules:
To qualify for a 1031 exchange using a DST, investors must adhere to the same rules and timelines as traditional 1031 exchanges. This includes identifying the replacement property within 45 days of selling the relinquished property and completing the acquisition within 180 days.
Fractional Ownership:
Investors in a DST 1031 exchange own a fractional interest in the entire DST portfolio. The ownership structure is similar to a real estate investment trust (REIT) but is specifically designed to meet the requirements of a 1031 exchange.
Exit Strategy:
Typically, DST investments have a finite life, and there is a predetermined exit strategy. This may involve selling the properties within the DST and distributing the proceeds to investors, or in some cases, the properties may be refinanced.
Vice President | Account Manager
IPX1031 Exchange
Nancy.Hughes@sis.ipx1031.com
(307) 231-2542 - Work
www.ipx1031.com
