Deferred Sales Trust?

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irvinehomeowner

irvinehomeowner

Well-known member
I've seen this on social media and some quick googling has me wondering if it's legal to use this in California (saw some article where the FTB is penalizing for it).

www.1031gateway.com

Deferred Sales Trust 101: A Complete Guide | 1031Gateway

Deferred Sales Trusts provide an alternative to 1031 exchanges for deferring capital gains taxes on appreciated assets. Unlike exchange-based tax-deferment methods, Deferred Sales Trusts are an instance of a special kind of sale, called an “installment sale”, which can be used to defer capital...
www.1031gateway.com www.1031gateway.com

TLDR; It's a way to put the proceeds into a trust with a "payment plan" to avoid capital gains.

And yes... we are thinking about selling and trying to find the loopholes. :)
 
@iho - so you think the top is in or you thinking of moving somewhere? Sounds like your kids are college age so no more need for Irvine??
 
We'd like to stay in Irvine but even the smallest places are above $1m. Thinking about splitting into 2 properties, the 2nd one for the kids but need to stay Irvine-centric due to work, friends, etc. May have to go to Tustin (ugh LL) or Costa Mesa or Lake Forest.

Just looking at options.

Have no idea if the top is in... just that prices are ridiculous.

Other options are selling and parking the money somewhere (like the DST) and renting, getting a motorhome :) or staying put and maybe even renovating to add more space for the eventual boomerang (I even looked at what ADUs could fit into our backyard).

If I had a genie, would probably get a one-story with enough backyard for my own half court hoop (and pickleball). But that's not going to happen in Irvine. Did a 1-story search on Redfin recently and my only hope is to assume USC's identity. :)
 
irvinehomeowner said:
I've seen this on social media and some quick googling has me wondering if it's legal to use this in California (saw some article where the FTB is penalizing for it).

www.1031gateway.com

Deferred Sales Trust 101: A Complete Guide | 1031Gateway

Deferred Sales Trusts provide an alternative to 1031 exchanges for deferring capital gains taxes on appreciated assets. Unlike exchange-based tax-deferment methods, Deferred Sales Trusts are an instance of a special kind of sale, called an “installment sale”, which can be used to defer capital...
www.1031gateway.com www.1031gateway.com

TLDR; It's a way to put the proceeds into a trust with a "payment plan" to avoid capital gains.

And yes... we are thinking about selling and trying to find the loopholes. :)
Click to expand...
Come on man, pay your fair share :sneaky:
 
irvinehomeowner said:
I think you still end up paying the tax but over time. I don't know enough about it.
Click to expand...
Yeah, I think it is exactly that. If your gain is $1M, instead of receiving all $1M in the year you sold and then having to pay a lot of taxes on it at a high rate.. the $1M would go into this deferred trust and then you would schedule it to pay you $100k per year or 10 years.
 
You could follow the USC playbook and rent out your current home (maybe hiring a manager to deal with the headaches), and either buy or rent a second home with more space. Once the kids are on their own, you could always move back to your cherished Irvine.
 
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