Why Was The Delaware Statutory Trust (DST) Formed?
Delaware Statutory Trusts or DSTs are an attractive investment strategy for many investors, offering benefits like passive income, fractional ownership, hands-off involvement, and tax deferral through 1031 Exchanges. Why did it become popular in the first place? Why was the Delaware Statutory Trust formed?
Delaware Statutory Trust (DST) Financing for 1031 Exchanges
Financing may not seem necessary in a 1031 Exchange since you’re theoretically reinvesting all the proceeds of a property sale into a Delaware Statutory Trust (DST). However, various scenarios in real life can create the need for financing. This article provides an overview of these options to help you understand the more common DST financing approaches. Let’s dive in.
Important Things to Know About Wash Sale Rules
Gains and losses are part of investment activity. While the IRS taxes your capital gains, you could use the capital losses to offset taxable income, provided you're not triggering the wash sale rule. Unfortunately, many investors unwittingly trigger the wash sale rule when they reinvest dividends or rebalance portfolios after selling at a loss.
Understanding Real Estate Investment: What it is and How to Buy
For many, investing in real estate is often viewed as a way to complement traditional asset classes. While outcomes vary, real estate investments may provide benefits such as diversity, passive income, and additional benefits.
REITs vs. DPPs: Similarities and Differences
Many real estate investment strategies are available to meet various needs, risk profiles, and investment goals. Two common approaches are real estate investment trusts (REITs) and direct participation programs (DPPs). Both strategies allow real estate exposure and potential income generation but have different structures, tax treatment, and risks.
1031 Exchange Rules: Vacation and Second Home Qualification
The IRS has relatively flexible rules on what types of property qualify for a 1031 exchange or like-kind swap. However, there are a few types of real estate that toe the line between investment or personal use property, leading to confusion among new and seasoned investors alike. These assets include vacation homes and second homes.
Can Anyone Invest in a Delaware Statutory Trust?
A Delaware Statutory Trust (DST) can be an attractive investment vehicle for owning investment real estate without management headaches. Investors interested in a 1031 exchange could find that a DST might be a good replacement property, as it’s easier to equate the value of fractional shares to that of the relinquished property.
The Pros and Cons of Direct Real Estate Investments
If you’re considering an investment in income-generating real estate, the correct strategy can lead to potential wealth generation. One such approach is a direct real estate investment.
Double-Net Lease: What It Is, How It Works, Triple Net Difference
Commercial real estate lease contracts come in a few variations, and one of these is the double-net lease. Through this arrangement, the tenant and landlord have similar proportions of financial responsibility, making this option attractive to investors who want a balance of income and costs. How does a double-net lease work? How does this compare to triple net leases? Below, Realized 1031 has shared a guide explaining this arrangement, its pros and cons, and more.
Reverse 1031 Exchange: Timeline, Rules, How It Works
For investors who want to defer taxes, 1031 exchanges remain an appealing option. Thanks to this like-kind exchange, you can swap one property for another without incurring tax liability. Since there is no sale, the IRS doesn’t levy capital gains taxes until you eventually make a constructive receipt. In this process, finding the replacement property comes after selling the relinquished one.
