Deferring Gains in Syndications Through Deferred Sales Trust

The Cash Flow Connections Real Estate Podcast. This podcast provides insights into the intricacies of commercial real estate investing through interviews with some of the leading investors, sponsors, and managers in the U.S. The program centers on cash flow focused asset classes such as mobile home parks, self-storage, multi-family, and office, but virtually all types of real estate transactions will be covered. The podcast is hosted by Hunter Thompson, founder of Cash Flow Connections and full-time real estate investor. Cash Flow Connections is a private equity firm that assists accredited investors achieve diversification though recession-resistant real estate.

“At IIREC 2020 we did a panel called how to own real estate forever and it was very powerful, basically we had 3 panelists all of whom were very strong proponents of using 1031 exchange to permanently or semi-permanently defer capital gains as supposed to cycling out the properties, taking the tax in and then purchasing new assets. But there are some drawbacks to the 1031 strategy. Especially when you are pulling in a group of multiple investors, you have a very limited amount of time in which you can complete a 1031 and you have to line up your multiple closings at the same time you have to make sure that all your investors are going to come along for the ride. Though there are some ways around that. And you have to buy a property of equal or greater value each time you exchange. Among various other things.

So the question that everybody is asking right now is. Is there another way to defer taxes on syndicated investments? Our guest for today thinks there is. In fact, he is going to talk about a tool that he believes is extremely underutilized given how advantageous it can be. And he brings up a lot of great points. And certainly addresses all of my questions in a lot of details, as you probably know, I really like to get into the weeds of things. So if you are looking to learn something today. This is a good episode for you.

In this discussion, we are going to talk about, what a deferred sales trust is. And what the main benefit of this strategy. Especially compared to 1031. Both are good strategies. I want to understand the difference and why people find this interesting. Now the strategy something that not a lot of people is super familiar with so has it actually been tested in court? What does the IRS say about it? Have these strategies and these closes been audited and what is the result of those audits? And also when does using the strategy become economically viable? How many Gains are you talking about? How big of property do you need to be selling in order for it to make sense? ” – Hunter Thompson

Our guest for today is Brett Swarts, who is the Founder of Capital Gains Tax Solutions. Each year, he equips hundreds of business professionals with the Deferred Sales Trust tool to help HNW clients solve capital gains tax deferral limitations. Brett’s experience includes Deferred Sales Trusts, Delaware Statutory Trusts, 1031s, and $85mm of closed commercial real estate brokerage transactions.

Today we are going to discuss…

· What a deferred sales trust is and what the main benefits of the strategy are compared to the 1031

· Whether this strategy has actually been tested in court or if it is a new frontier

· When using this strategy becomes economically viable

LISTEN TO THE FULL PODCAST EPISODE HERE:

Learn more about Deferred Sales Trust Visit our website: www.CapitalGainstaxsolutions.com get free resources, listen to our podcast, and enroll to our academy.