How Fractional Real Estate May Support Multi-Generational Wealth Strategies
As families prepare for wealth transfer, advisors are increasingly called upon to help families create strategies that support preservation and grow capital across generations. Real estate continues to play a meaningful role in legacy portfolios —but traditional ownership models can present challenges. Management responsibilities, illiquidity, and concentrated risk often hinder long-term planning.
Using 1031 Exchanges for Succession Planning in Family-Owned Businesses
A family-owned business is often created with the goal of building a legacy and supporting future generations. However, succession planning can be a complex and sensitive undertaking. The stakes can be high, especially if real estate is part of your business’s assets. One strategy that may be used to defer capital gains taxes and align real estate holdings with long-term planning goals is the Section 1031 exchange.
Do Qualified Intermediaries Provide Audited Financial Statements?
1031 exchanges provide tax-deferral benefits that can support long-term portfolio growth and estate planning goals. However, in order to complete the like-kind swap, you’ll need to work with entities like a qualified intermediary or an accommodator. These are the third-party entities that hold your funds between the sale of your relinquished property and the purchase of your replacement property until a replacement property is acquired.
How UPREIT Transactions Can Help Mitigate Depreciation Recapture
While depreciation deductions are a standard and useful component of real estate tax planning, depreciation recapture can create a significant tax liability if a property is later sold at a gain. There are ways to mitigate this tax liability, however, and one of the strategies is the Umbrella Partnership Real Estate Investment Trust (UPREIT). UPREITs are structured to allow property owners to contribute real estate in exchange for operating partnership (OP) units—potentially avoiding a taxable sale at the time of contribution
Interest Rate Swaps Explained: Definition, Types, and Examples
Many interest rates in the market are variable and tied to financial benchmarks, making them subject to frequent fluctuations. These changes can significantly affect a company’s or investor’s cash flow or borrowing costs. As such, many institutions use interest rate swaps—financial contracts between two parties to exchange interest payments over a specified period. These tools are commonly used to match financing streams with an entity’s risk preferences or expectations about interest rate movements.
Strategies to Reduce or Defer Capital Gains Tax When Selling Land
Innovative Strategies for Real Estate Investors Managing Vacant Property Sales
DST Rollovers and Reinvestment Strategies Explained
Entering a Delaware Statutory Trust (DST) is a strategic investment approach that allows individuals to pursue passive income as well as diversification. Paired with a 1031 exchange, investors may also defer certain taxes, which can support longer-term wealth preservation. However, DSTs have a finite life cycle. When the DST liquidates its assets five to 10 years after its initial establishment, investors will need to decide how to handle the proceeds. What are the next steps, then?
Who Can Advise Me on a 1031 Exchange?
Undergoing a 1031 exchange is a tax-deferred transaction. While often utilized by accredited investors, it is open to a range of taxpayers who meet the criteria. The process includes strict timelines and compliance obligations, and even small errors can jeopardize the tax-deferral benefits. For this reason, many investors choose to engage qualified professionals who can offer guidance and help support compliance throughout the exchange.
Navigating Interest Rate Risk in DST Investments
Participating in a Delaware Statutory Trust (DST) offers several potential benefits to investors, such as passive income and access to institutional-grade real estate assets. When structured through a 1031 exchange, DSTs may also provide tax-deferral opportunities. However, as with any investment, DSTs are subject to various risks—including interest rate risk.
Can You Do a 1031 Exchange on a Manufactured Home?
A 1031 exchange is a tax-deferred investment strategy that lets you swap two like-kind properties. Since the transaction may qualify for tax deferral, you can delay capital gains tax payments and preserve your capital. However, taxes are not eliminated and may apply under certain circumstances. The types of assets you can exchange are regulated by the IRS, so you can’t exchange properties on a whim.
