November 25, 2021

Capital Gains Tax Deferral

29 minutes

When it comes to deferring the capital gains tax that comes along with selling property or other business assets, there are very few options a seller has. A deferred sales trust (or DST) is one option that is highly underutilized when it comes to avoiding paying the capital gains tax on an appreciated asset.

In this episode, we’ll get a chance to hear from John Balmer, who will be going over the ins and outs of the Deferred Sales Trust and how it works to help you get more profit in your real estate business.

What You’ll Learn in This Episode:

02:41 What is a Deferred Sales Trust

05:25 How Deferred Sales Trust work

09:38 Deferred Sales Trust vs. 1031

11:58 Capital gains on depreciated real estate properties

14:57 Getting out of rental properties and its impact on one’s income stream

16:53 How real estate investors can profit more using Deferred Sales Trust

20:31 What are the costs involved in doing Deferred Sales Trust

Key quotes:

04:52 “If you're looking at a large transaction, sometimes it can be really difficult. So you see a lot of failed 10 31. So that's where we can step in and know not only outright, you know, replace the 10 31, but also rescue a failing 1031 exchange.” -John Balmer

10:39 “So they're always looking for the best opportunity in the marketplace. If everything is up, you might want to sit on the sidelines for a period of time, wait for that next market cycle to go through, and buy it at a more opportune time, deferred sales trust gives you the flexibility to do that. Whereas a 1031, based on the timing constraints just doesn't offer that.” -John Balmer

14:19 “So let's say you've depreciated your former property all the way down. You're having to deal with issues of depreciation, recapture, things like that. You can actually take this as an investment, move it into the trust and then actually go out and purchase a new piece of property at the opportune time without the constraints of the 10 31 and then actually enter, have a new depreciation schedule on that piece of property altogether.” -John Balmer

15:39 “Having the liquidity of a diversified portfolio of assets within the trust gives a lot more flexibility and a lot more options.” -John Balmer

18:21 “What we've found is the real estate agents or the real estate advisors that we've educated, actually get more listings by utilizing our structure, because they're actually bringing something more to the table, to their client than just a buy and a sell of a piece of property.” -John Balmer

Links/Resources:

Annuity Straight Talk

Call Annuity Straight Talk at 800-438-5121 or schedule a call at AnnuityStraightTalk.com

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