Tax-Deferred 1031 Exchange

An exit strategy for owners of investment real estate

Learn how to move from Landlord to Investor!

Our 1031 Exchange Mission

To assist our landlord clients in deferring taxes, reducing hassles and diversifying their concentrated investment real estate into a nationally diversified, professionally managed real estate fund. Our clients eliminate the headaches associated with being a landlord and actively managing their rental properties while maintaining the benefits of owning real estate in their globally diversified portfolios.

The 1031 Exchange Into a DST

Section 1031 of the Internal Revenue Code allows an investor to exchange property that was held for rental or investment purposes for other “like-kind” property that will also be held for rental or investment purposes. This enables the investor to defer payment of ordinary income, capital gain, depreciation recapture and/or Medicare surcharge income tax liabilities.

A traditional 1031 exchange is great for current real estate investors who wish to continue to own and actively manage physical real estate property. However, for those investors who would prefer a less active approach to owning real estate and need an exit strategy, utilizing a DST may be the answer.

A Delaware Statutory Trust (DST) is a legally recognized trust for conducting business and can be offered as a conduit for replacement property for accredited investors during a 1031 exchange. The replacement property now becomes a direct ownership of an interest in a professionally managed property or pool of properties.

The real estate sponsor firm acquires properties under the DST and then sells shares of the DST to investors. Investors are able to roll their 1031 exchange proceeds into the DST to purchase a beneficial interest. By pooling their funds together, investors are able to access these institutional quality properties with professional management that otherwise may be out of reach. 

The benefits of a 1031 Exchange using a DST include the deferral of taxes, elimination of active property management responsibilities. Using a DST also increases diversification by geography, number of properties and type of property. The investor has the potential to diversify and include real estate such as multi-family apartments, NNN retail, self-storage, assisted living facilities and more. If an investor passes away while owning an interest in a DST, their heirs receive a step-up in cost basis, which eliminates the taxes due on the initial gain forever.

Advantages of Hiring Endowment Wealth Management

1

Independent SEC Registered Investment Adviser (RIA)

Our fee-only fiduciary advisors ALWAYS keep your best interests first and foremost.
2

Avoid Commission Costs

Typically between 6-8% when reinvesting proceeds.
3

Tax Mitigation

We work with you and your tax professional/CPA to mitigate the tax impact of owning investment real estate, including the 20% QBI deduction.
4

Diversified Professional Real Estate Funds

Gain access to a diversified pool of real estate using fund managers with expertise.
5

Ongoing Guidance

We work with you to make sure your 1031 exchange process runs smoothly and provide ongoing monitoring and reporting.

Endowment Wealth Management

Your Fiduciary Advisor

Get Started

Your first step in a DST 1031 Exchange is learning whether or not it is right for your situation. As a fiduciary advisor, Endowment Wealth Management will objectively look at your situation and advise whether or not a DST 1031 Exchange is a smart choice for you.

If there is a basis to move forward, Endowment Wealth Management will help you find quality real estate funds to invest in, curated by our experienced team of investment professionals.

If you think that a DST 1031 Exchange might be something you’re interested in:

  • Call us at 920-785-6010,
  • Email us at Sam@EndowmentWM.Com
  • Click the button below to schedule an appointment to talk with one of our elite wealth advisors.
Schedule a Consultation

The information on this page is for informational purposes only and should not be considered personalized investment or tax advice.  Investing in a DST 1031 Exchange involves risks, including, but not limited to long-term investing risk and potential loss of capital.  Endowment Wealth Management is not making any specific recommendations that investors should or should not participate in a DST 1031 Exchange.  Investors should always consult with a registered investment adviser and tax accountant to determine if any particular investment, including those that involve a DST 1031 Exchange, and its corresponding tax impact is appropriate for their personal circumstances. Not insured. Not Guaranteed. May Lose Money.