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Defer/ Save Taxes on Investment Property Sales

Most investment property owners would like to avoid paying taxes, which could be as high as 40%, on the sale of appreciated properties. Section #1031 of the Internal Revenue Code allows for that tax deferral under certain conditions. However, rather than exchanging it into another physical property, we assist investors in exchanging the sales proceeds into shares of multiple, IRS approved Delaware Statutory Trusts (DSTs). 

Here is a Summary of Taxes that could be Deferred or Saved by doing a qualifying exchange:

  • Federal Capital Gains Tax (current maximum20%).
  • Depreciation Recapture (currently 25%).
  • California Taxes Capital Gains as Ordinary Income (current maximum of 13.3%).
  •  Obamacare tax may apply (maximum 3.8%).

(Note: All taxes are subject to change at any time)

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What We Do!

We help our clients invest in institutional quality real estate with the goal of providing income, capital preservation and appreciation over the long term. We work with the clients' CPA, attorney, and other advisors to thoroughly understand their liquidity needs as well as their short-term and long-term financial goals and needs.

Potential Benefits of Institutional Quality Real Estate 

While there are no guarantees, institutional quality and professionally managed real estate may provide:

  • An increase in value over the long term.
  • Passive income.
  • Hedge against inflation.
  • Partially sheltered income through depreciation.
  • Benefits of financial leverage to increase returns.
  • Tax benefits on acquisition, during the holding period, and upon disposition.
  • A store of value during tough economic periods.

Basic Exchange Requirements

  • Replacement property must be of equal or greater value.
  • Replacement Property must have equal or greater debt. 
  • All proceeds must be reinvested to make the transaction completely tax deferred.