Coastal 1031 Exchange Consulting
Guiding You Through 1031 ExchangesWHAT INVESTORS NEED TO KNOW ABOUT
1031 EXCHANGES
A 1031 Exchange (named after Section 1031 of the Internal Revenue Code) lets real estate investors defer capital gains taxes and depreciation recapture when you sell an investment or business property and reinvest the proceeds into a like-kind replacement property. This powerful wealth-building tool keeps more capital invested, enabling portfolio growth, upgrades to higher-value assets, and long-term wealth building through repeated exchanges. Taxes are only due upon a final sale without reinvestment, potentially deferred indefinitely.
To qualify, properties must be held for investment or business use (not personal residences), and strict IRS rules apply—including using a qualified intermediary, meeting like-kind requirements, and adhering to non-extendable deadlines.
IRS REQUIREMENTS
Many investors consider a “Passive 1031” approach because they’re tired of the management burden, concentration risk, and the pressure to buy and manage yet another property.
A DST may help if you’re looking for:
- More passive ownership (professionally managed real estate)
- Diversification across property types and geographies (when using multiple DSTs)
- A practical solution when a 1031 timeline is tight and sourcing a direct replacement property is challenging
How I Help 1031 Exchangers
1031 Exchange Planning
Replacement Property Options
Delaware Statutory Trust (DST) Review
Gross-Up Review
Sponsor & Offering Review
Execution Support & Timelines
Risk & Fee Clarity
Operations
A Simple Process for a Time-Sensitive Decision
A 1031 exchange has strict deadlines and big financial consequences. We keep the process clear and efficient: start with a quick call to understand your timeline and goals, then review DST options for fit, fees, leverage, and sponsor considerations. We coordinate with your Qualified Intermediary and your tax/legal professionals so you can move forward confidently—without taking on another hands-on property.
Expand Your Sales, Marketing, & Networking Reach
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Have an Active Vision, Strategy, & Roadmap to Reach Your Goals
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Scale & Maintain Healthy Operations & Culture
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I Also Give Hands-On Workshops & Talks
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Frequently Asked Questions
Is this about Delaware Statutory Trusts (DSTs) or Deferred Sales Trusts?
This page is about Delaware Statutory Trusts (DSTs) used for real estate ownership and 1031 exchange replacement property—not Deferred Sales Trusts.
Can a DST be used as replacement property in a 1031 Exchange?
Often, yes—when structured properly and executed within 1031 rules. Your Qualified Intermediary and tax/legal professionals should confirm the specifics for your situation.
Are DSTs truly “passive real estate”?
They’re designed to be professionally managed and more passive than direct ownership, but they still carry real estate, financing, and sponsor risk.
What are the biggest risks with DST investing?
Common risks include illiquidity, reliance on sponsor execution, real estate market cycles, leverage/financing risk, and fees that can materially affect outcomes.
How long are DSTs typically held?
Many DST strategies are designed around multi-year hold periods and a future liquidity event, but timelines vary by offering and market conditions.
What is a “gross-up” and why does it matter?
In certain offerings, compensation typical in commission-based channels may be reflected back to the investor as additional credited equity at purchase (“gross-up”). Availability varies and must be confirmed per offering.