Delaware Statutory Trust – Things you should know

The Delaware Law is an institution that provides for its members a great flexibility in terms of business. From the low investment requirements, to personal assets protection, the DST law is a great option for those who want to run a business without much implication. Other good aspects of the trust are the DST properties transactions, which lets trustees to exchange properties for interests without being the subject of any tax requirements. Although for many this Trust comes as a business solution, for others it is a complicated matter. For the last category of individuals, we are here to provide some pieces of information, just to bring some light on the subject.

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It is a passive way of making investments

For the businesspersons with a tight schedule 1031 investments seem to be the best solution in terms of real estate investments. This way you will get rid of the hassle implied by managing real estate properties, like rental blocks. The Trust will retrieve all the management responsibilities of ones. Moreover, the special status of the Trust permits its members to benefit from profit that is not o subject of any tax law.  Investing in DST might enable many to only manage the businesses they are passionate about, without compromising their income.

Tax-deferred investments

Although they are not something new in the American economic context, DST’s have become more and more popular lately. The fact that no taxes are perceived since 2004, when the tax responsible entity IRS has applied to the Trust the Revenue Ruling, it made them the easiest way of making investments without paying taxes. For example, using the 1031 exchange law you can swap properties by using third parties. Similar is not what you might think. We are not talking about the purpose of the property, but about its value. Therefore, it is legal to swap a warehouse with a rental building, if their values are the same. However, after a transaction of this kind, no extra money should be registered, because they will certainly be a subject to the IRS’ tax law.

You need a professional third party to make such transactions

If you don’t want to pay any taxes from a transaction of this kind, you must use a specialized third party to handle the money until you find a desired property to make the exchange with. At any time, you are not allowed to lay hands on the money, because they will become a subject to tax laws. Instead, get in touch with a professional agency that can handle all the process, help you with the papers and maybe help you find a similar property as yours.

Here are some pieces of information for those who consider this type of investments as an option to add some value to their transactions. There are many other things you should be aware about regarding the Trust. To find out more about those, get in touch with a team of professionals and ask for their advice. The solid knowledge in the field and experience certainly recommends them.