Do you own a highly appreciated asset? Use the Delaware Statutory Trust

If you have recently come in possession of an estate asset one that can be characterized as commercial, or can be used for business purposes, but you believe it might not exactly provide you with the ownership advantages desired, perhaps you should think about pursuing an exchange. You might have heard about property exchanges until now, and how they can benefit real estate investors, but using Delaware Statutory Trust in 1031 exchanges can be the most appealing possibility for a wide range of reasons. Here’s what you should know about DST swaps and why they are convenient:

 

Contractual freedom

As long as all parties involved are on the same page, the specifics of the contract signed can be as versatile as you desire. You can create exactly the type of relationship you want with the other parties involved, and rules will be stipulated in the contract only if you are unable to reach an agreement with the others. Beneficial owners, rights, duties, economic rights, powers – all of these can be modeled to suit your specific requirements and needs. Once you create a Delaware Statutory Trust or DST, it is up to you to put into the contract what’s best for your situations, there are no pre-determined obligations you have to worry about.

Management flexibility

In comparison with other alternatives, DSTs come with increased flexibility and relief when it comes to long-term management requirements. Because you can come to an agreement right from the start regarding your role in the property ownership, you will not be subjected to complex task further in the future. The affairs of a DST are usually carried out by a trustee, so as the beneficial owner, you don’t need to handle every responsibility or deal with all complications that might arise, because you have support at your disposal at all times. The relief in management is certainly one of the factors that make DSTs such an appealing option for real estate entrepreneurs.

Limited liability

As a trustee or beneficial owner of a DST, you will also not have to think about the entity’s potential obligations nor debts. As an investor, it can be extremely advantageous to collect financial gains, all without having to think about potential debts appearing, or other issues that might cause concerns. With limited liability, your personal situation is protected at all times, which of course is a big plus in the real estate industry. It’s important to know right from the start all of your rights as a DST owner.

If your real estate property can be considered commercial, and you can start using it for generating income, then you can also swap it for a more financially advantageous option. Through the DST, you have the possibility of upgrading your property to one that can bring you more advantages, all without having to pay huge amount on taxes. Research the topic further, and use this possibility to start a business in the real estate industry, one that is truly profitable.