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What is the Minimum Investment with a 1031 DST?

| June 15, 2018
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What is the Minimum Investment with a 1031 DST?

Last week I had an investor call and inform me that he just sold his farm in Nebraska for $820,000, with virtually no cost basis! He is an active real-estate investor, owning multiple single-family rental houses in eastern Nebraska. He has already identified five properties he wants to 1031 Tax-Defer Exchange, but can’t find a sixth one (with the small amount left of $50,000) at this time to reach $820,000.

So the big question was “what is the minimum 1031 DST investment amount?” Normally the 1031 DST sponsors we work with set a $100,000 minimum, but I have found in special circumstances like this, some sponsors will make an exception to invest as little as $50,000… if you ask them very nicely.

This situation concerns “Boot” money… left-over cash after the sale of your property, and still with the Qualified Intermediary (QI) - that has NOT been used to purchase a replacement property. If you don’t execute a 1031 Exchange for the entire amount, the QI must pay the remaining cash to you after closing by the end of the 180-day purchase deadline period…

and it will be taxed as partial sale proceeds, and generally as a capital gain if held for more than one year.

As you can see, a 1031 Tax-Deferred DST Exchange can be a very useful, flexible, as well as smart strategy, when buying and selling investment real estate…

with the potential to produce a competitive income stream, defer taxes, and provide appreciation opportunity to build wealth.

 

Could a 1031 DST Exchange make sense with your specific circumstances? Deferring taxes on highly-appreciated investment property can be a long-term wealth builder. If you have any questions about 1031 Exchanges or want info on our current 1031 DST offerings, please contact me, Dave Pimper, at 1-800-727-1031 or at www.1031propertyxchange.com.

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This type of investment is subject to risks, including those real estate risks associated with the operation and leasing of retail properties. These investments are for Accredited Investors only. There can be no assurance the investment objectives will be achieved.

This material is neither an offer to sell nor the solicitation of an offer to buy any security, which can be made only by the Private Placement Memorandum (PPM), filed or registered with appropriate state and federal regulatory agencies, and sold only by broker/dealers authorized to do so.

Securities offered through Calton & Associates, Inc. 2701 N. Rocky Point Dr., Suite 1000, Tampa FL 33607 (813) 264-0440. 1031 Property Xchange and Calton & Associates, Inc. are separate entities.