Why Investors Prefer To Defer Taxes Using 1031 DST Properties?

Lately, the investors are actively looking to invest in 1031 Delaware Statutory Trust (DST) Properties. If we go by the facts, the Delaware Statutory Trust (DST) investments have increased to a great extent in the past 1.5 years.

Why wouldn’t they? When the investors choose to go with Delaware Statutory Trust (DST) investments, not only do they free themselves up from the property management struggles but also help them in deferring the payment of 37.5% tax payment and much more.

If you are a new investor, you may be confused between NNN, DST, REITS. This blog may help you make the best investment decision or affirm your decision to invest in 1031 DST Properties. Take a look.

  • Relieves you from the management burden- All management-related power lies in the hands of the property sponsor. The affiliated trustee takes all the decisions, and the investors need not to worry about it. Maybe, that’s why more agile decisions are taken in DST investments. No management burden and secured money investment free the investor to think about more investment plans.
  • Better Investment Diversification- The scope of investment rises in 1031 DST Properties. A single DST is allowed to have a maximum of 2,000 investors. Each of them can invest an amount as little as $ 1,00,000. This also gives investors the luxury to invest small amounts across multiple DST programs and yield better returns while deferring the taxes levied on their Relinquished Property.
  • Huge investments- In DST, many investors collectively invest in a single property in the name of the LLC (trustee). This way, the investors can invest in a huge property, which yields them a higher return on their investment. Also, the risk is very low.
  • Special ownership structure- Generally, investors used to own an amount that can be done. When you invest in DST as replacement property, the trustee, a limited liability company (LLC), covers the investors and doesn’t hold them liable. Unlike other investment options that an investor has here, one trustee signs the loan papers and sponsors the property. Investors, in case of any losses, can declare themselves bankrupt, which keeps their assets safe.
  • Minimal ongoing fees- Delaware Statutory Trust (DST) investments don’t require an SPE. This is why investors have to pay minimal ongoing fees. There is no single purpose entity, and henceforth no or minimal maintenance fees are required.

In short, the primary reasons due to which investors are choosing to invest in 1031 DST Properties are low investment returns on other investment options, demographics, and highly growing real estate values. According to industry statistics, up to $ 20-23 billion has already been securitized, out of which a major portion is with DSTs. And hence, DST demand is expected to soar. The investors will continue to choose 1031 DST Properties to defer their taxes and earn the monthly cash yield of 5% to 6%, even 10% in some cases. Should you have been looking for a reliable company for Statutory Trust (DST) Investments, keep the name of 1031Sponsors.com in mind. We are a known name in the 1031 exchange marketplace. Whether it is a piece of sound investment advice, help with the exchange of Relinquished Property with the Replacement Property, or informing you about the pros and cons of doing a particular exchange, we are readily available. Call us on +1 888-876-6005 or send an email at info@1031sponsors.com today!

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1031Sponsors.com is a web portal owned by Investment.Net, LLC. The company is functioning in the 1031 exchange market for more than 15 years. Neither Investment.Net nor 1031Property intend to act as a broker or sell any goods or services. 1031Sponsors does not offer legal or tax advice. Tax topics discussed are for educational purposes only and should not be considered professional tax advice. It's recommended that you discuss your situation with your tax or legal advisor. Distributing an investment in different assets or choosing alternative investments involves higher risks than traditional investments and shouldn't be taken for granted. All alternative investment strategies are sold along with a prospectus that discloses all risks, fees, and expenses. These investments are not tax-efficient, and an investor should consult with his/her tax advisor before investing. The investor should be prepared to bear loss knowing that financial risks are attached to such investments.

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