4 Reasons Estate Attorney’s Utilize DSTs for Legacy Planning

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By Steve Haskell, Vice President at Kay Properties & Investments and The Kay Properties Team

Advisors at Kay Properties & Investments have worked closely with Estate Attorney’s to assist with their client’s legacy planning. 

The Delaware Statutory Trust can offer many potential benefits to investors. Below are four reason estate attorney incorporate DSTs in their client’s estate planning.

Everyone’s situation is unique. All investors should speak with their tax/legal advisor when conducting their own estate planning.

1. Potential tax benefits. According to the Internal Revenue Code 1014(a), when a person (the beneficiary) receives an asset from a giver (the benefactor) after the benefactor dies, the asset often receives a stepped-up basis to the market value at the time the benefactor dies. This often applies to DSTs as well. However, everyone’s tax situation is unique, so it advised that all investors speak to their own tax professional regarding their specific situation.

2. Avoid potential burdens of property management. Many investors do not mind managing their own properties. However, they fear the potential of leaving their spouse and or family with the burden of navigating through the nuances of property management while grieving the loss of a loved one. DSTs are considered passive investments that spare investor’s loved ones and or heirs form the stresses and burdens of property management.

3. Increased flexibility in assigning inheritance. Investors may place their investment in one property or diversify between a multitude of properties. Clients can divide the shares equally among heirs, assign each heir a property, or use a variety of different legacy planning strategies. Some clients even involve their heirs in considering the DSTs they would potentially inherit one day.

4. Prevents infighting between heirs. Most estate attorneys have frightening stories of family feuds resulting from inheritance conflicts. A daughter may want to take over the management of her parent’s investment properties, but the other siblings wish to liquidate and pay off debt. A son may desire to keep the parent’s beach rental, but his sister needs the money to pay for her kid’s college. This often causes devastating consternation to exacerbate an already stressful situation.

DST are not suitable for everyone. However, for many heirs, DSTs may provide a turn-key options for passive income and offer the flexibility to choose what they wish to do with their inheritance without impeding on the priorities of the other heirs.  

If you wish to learn more about whether DSTs are an appropriate option for you or your clients, contact Kay Properties and Investments at www.kpi1031.com or 1 855- 899- 4597.

About Kay Properties and www.kpi1031.com

Kay Properties is a national Delaware Statutory Trust (DST) investment firm. The www.kpi1031.com platform provides access to the marketplace of DSTs from over 25 different sponsor companies, custom DSTs only available to Kay clients, independent advice on DST sponsor companies, full due diligence and vetting on each DST (typically 20-40 DSTs) and an active DST secondary market. Kay Properties team members collectively have over 115 years of real estate experience, are licensed in all 50 states, and have participated in over 15 Billion of DST 1031 investments.

This material does not constitute an offer to sell nor a solicitation of an offer to buy any security. Such offers can be made only by the confidential Private Placement Memorandum (the “Memorandum”). Please read the entire Memorandum paying special attention to the risk section prior investing. IRC Section 1031, IRC Section 1033 and IRC Section 721 are complex tax codes therefore you should consult your tax or legal professional for details regarding your situation. There are material risks associated with investing in real estate securities including illiquidity, vacancies, general market conditions and competition, lack of operating history, interest rate risks, general risks of owning/operating commercial and multifamily properties, financing risks, potential adverse tax consequences, general economic risks, development risks and long hold periods. There is a risk of loss of the entire investment principal. Past performance is not a guarantee of future results. Potential cash flow, potential returns and potential appreciation are not guaranteed.

Securities offered through WealthForge Securities, LLC. Member FINRA / SIPC. Kay Properties and Investments, LLC and WealthForge Securities, LLC are separate entities.

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