1031 DST Exchange Investment Group
Solely based on your commercial needs, we offer a holistic approach to assist you in navigating through 1031 Exchange and DST. Better than our competitors, 1031 DST Exchange Investment Group is capable of transforming the struggles you face in choosing the right investment into a highly profitable asset of your business. After serving our valuable high-profile clients in DC over the years, we have built numerous successful cases with many local DST investors and beyond. Offering a bespoke solution to execute your unique commercial vision is all we do for 24 hours a day, seven days a week.
DST with 1031 Exchange is what you need for the next money-making investment plan.
Restrict to Real Property
Prior to December 31, 2017, tangible or intangible properties were permitted under the 1031 Exchange. It includes aircraft, automobiles, heavy equipment, and mineral rights. However, after the cut-off date, only buying or selling real properties are qualified for the purpose of the 1031 Exchange. This alteration was manifested by the language assertion directly in the Internal Revenue Code. Such a change was considered substantial. But since commercial and investment real estates already dominated the majority of the 1031 Exchange, it did not impact the market very much in practice.
The properties have to be “the same nature or character, even if they differ in grade or quality.” For example, swapping a rental property with a gym space would be allowed. It is worth mentioning that properties that involve stocks, bonds, notes, securities, and interest in partnerships are excluded. Although it does not require the investor to be a US resident, both properties for the Exchange must be located in the United States. However, keep in mind that the Foreign Investment in Real Property Tax Act of 1980 (“FIRPTA”) will be applicable for a foreign investor. It can trump some benefits of using the 1031 Exchange.
The value of the property you purchased must be at least the same or more than the one you sold for the Exchange. Because the 1031 Exchange aims to incentivize investments, the associated cost for the new property purchased can be counted as the property’s value, such as inspection and broker fee. If an investor decides to combine the value of multiple identified properties for the Exchange of his or her original property, the 200% Rule will apply. It means that such aggregate value shall not be more than twice the amount of the original property price for the benefit of the tax deferral.
DST enjoys the principle of freedom of contract. It permits the parties to create relationships that can tailor their business needs through their DST Trust Agreement (also known as the governing instrument). A trust agreement is mandatory for the creation of a DST. The agreement may contain any provision relating to the management of the business and affairs of the statutory trust, and the rights, duties, and obligations of the trustees, beneficial owners, and other persons. Based on the Delaware Statutory Trust Act, a governing instrument of DST can provide for taking any action, including the accomplishment of a merger, conversion, or consolidation. In addition. DST also allows other persons to manage the trust, including the DST’s beneficial owners.
It is really simple and straightforward to create a DST. It must be an association established by a governing instrument. A governing instrument is absolutely vital for a DST, and it is the very reason why DST excels over the other investment tools. A DST governing instrument can be any written instrument with few limitations on its content. The trust agreement does not have to be drafted in English, and no approval is required from any authority in Delaware for the submission of such agreement. This could be a major attraction for business organizations or private trust holders.
Because DST is a statutory trust, the Delaware Statutory Trust Act provides a comprehensive framework for legal reference. It expressly stipulates the authorization process and rules of governing. Contrary to “common law trusts”, Delaware Statutory Trusts can have statutes to revert to, if certain provisions are not clearly defined in the trust agreement. Therefore, it is much easier and quicker for a trust holder to get his or her questions answered with a high certainty within a few pages rather than reading through hundreds of cases.
We will be there for your investment from start to end.
Our advisors are fully licensed and widely recognized in the fields they practice. We recognize that every client is unique. Hence we do not believe in a streamlined template solution that can apply to all. We spend an extraordinary amount of time with every client to ensure your needs and problems are heard and addressed thoroughly. Our wealth management formula addresses the top five concerns most important to affluent families: Investment Consulting, Wealth Enhancement, Wealth Transfer, Wealth Protection, and Charitable Giving. They are ready to work tirelessly and offer a matchless strategic plan only for you.