WHAT ARE THE BENEFITS OF A COMPLEX SPENDTHRIFT TRUST FOR INVESTORS?
By utilizing a trust to defer capital gains taxes for generations, the investor can then have the trust sell the asset so that the funds can remain in the trust account until the investor finds a property that is the right fit. There is no requirement that the purchase be made within a specific amount of time. There is lots of freedom! The other benefit is that, upon the sale, the funds can be used for other needs and goals. Anything that the trust owns, the trust is responsible to pay for. Therefore, if the investor's primary residence is owned by the trust, then instead of buying another rental of equal or greater value, some of the sales proceeds can be used to pay for upkeep, utilities, mortgage, insurance, and property taxes of the primary residence, all pre-tax! Basically, this is the most dynamic capital gains tax strategy tool that we have found so far. It is quite amazing! However, anything this good comes with
a price. On average, from what we've seen, these trusts cost about $36K to set up and implement. That is certainly an upfront gut punch, but when one hears the long-term value of the trust, it makes a lot of sense. If you've been stuck in a 1031 exchange system or have ever paid taxes due to a failed exchange, then maybe it's time to look at other options that can help you or your investors have a lot more freedom and control. That is what you will find with a non-grantor, irrevocable, complex, discretionary, spendthrift trust.
THIS IS THE MOST DYNAMIC CAPITAL GAINS TAX STRATEGY TOOL THAT WE HAVE FOUND SO FAR.
SCOTT VARNEY Capital Gains Tax Strategist Financial Tax Strategies (408) 569-0778.
Scott Varney is a capital gains tax strategist as well as a financial services professional. He helps clients think through options to defer, reduce, or eliminate capital gains taxes upon the selling of a highly appreciated asset, in this case, apartment buildings. He has a background in real estate as a top 1% producer nationally in the realm of residential real estate. He enjoys being with people and loves the opportunity to help solve challenging issues. Click here for a free consultation to see if a trust is right for you.
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