A Time and Season for ChangeWith nearly 80 million baby boomers approaching the estate
planning phase of their wealth cycle, the focus has shifted from wealth
accumulation to wealth distribution. If you are an investor that owns rental
property or other types of investment real estate, you are likely in a season
of life where it's time to transform highly appreciated and actively managed
property into a more secure and reliable form of passive income. Income that can be used to fund home care, health care, charitable giving, and other lifestyle expenses. According to the US Census Bureau, nearly 60 percent of all
residential rental property is held by senior investors. Most properties are
older, requiring hands-on management and ongoing capital expenditures. Further,
the children dont want the burden of property management or responsibility for
selling properties after the parents have passed. Now, facing a crossroad,
older property owners desperately need an exit strategy. Section 1031 of the Internal Revenue Code states that any
taxpayer who sells property held for investment purposes or used in an active
trade or business can defer taxes provided that sales proceeds are reinvested
into one or more qualified replacement properties. While tax deferral is a
critical component, it does not solve the bigger issue of eliminating property
management. Fortunately, there is a solution that combines 1031 tax deferral
with diversified property income and simplified wealth transfer. In 2004 the IRS approved a co-ownership structure known as
the Delaware Statutory Trust or DST. DSTs are pre-structured, cash flowing
property interests that allow smaller investors to acquire a fractional
interest in larger Class A multifamily residential and commercial properties.
With low minimum investment requirements, multiple DSTs can be combined to
create diversified portfolios with professional third-party management. Sample
properties include Class A apartments, senior housing, medical and healthcare
facilities, industrial properties, self-storage, and U.S. government leased
properties. DSTs also offer flexible estate planning strategies for target date
liquidity needs and transfer of beneficial ownership to the heirs. As the baby boom generation prepares for the greatest wealth
transfer in history, it is critical to preserve assets through strategic tax
planning and income protection. A
carefully planned portfolio of DST property investments can compound wealth
through 1031 tax deferral and generate passive income for living, giving, and
legacy estate planning. Senior real estate investors have worked a lifetime for
Return-On-Investment and now it is time to experience Return-On-Life! Contact Petra Capital Properties to learn how
you can unlock financial freedom and finish life well through 1031 tax deferred
DST passive property investments. Editors Note: This article was submitted by Brad Watt,
Founder & CEO of Petra Capital Properties. He may be reached at
719-649-7770 or by email at bradwatt@petracapitalproperties.com For more
information visit: www.PetraCapitalProperties.com
*Distributions are not guaranteed. Securities offered
through Saxony Securities, Inc., Member FINRA/SIPC