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For Tax Subtraction, Buy a Fraction? Delaware Statutory Trusts for §1031 Exchange Replacement Property

One of the most difficult issues our clients face when they are involved in a §1031 Exchange is finding suitable Replacement Property within the tight 45-day identification period. We hear about cap rate compression from nearly every investor. Then, when they find a property, they still need to negotiate an acceptable price and complete their due diligence. That’s a big “to-do” list in such a short time period. And, if the property they identify doesn’t work out, they are out of luck. One possible solution for taxpayers in such a bind is the Delaware Statutory Trust (“DST”)… an Investment Trust or Land Trust that is usually formed under Delaware state law. Here’s the scoop on the pros and cons of DSTs.

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2020 Vision: 1031 Exchange Planning for the New Year

With the advent of the New Year, it’s time for taxpayers to begin the dreaded annual ritual of gathering their tax related documents for the journey to the accountant’s office. This is particularly true for taxpayers involved in a 1031 Exchange, but for them it’s not just gathering paperwork. Depending on the status of their Exchange, the New Year may present some deadlines to meet and some opportunities to explore. Here’s what you need to know.

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