Owning a rental business can be quite profitable, but this also comes with quite a few responsibilities. As a landlord, you might have taken care of numerous tasks on the regular in order to keep your business running and your tenants happy. However, when the time comes for you to retire, passing on responsibilities to someone else will be necessary, and if this prospect doesn’t exactly appeal to you, perhaps you should seek another alternative. Replacing your current real estate holding with another commercial property that perhaps is easier to manage could be the perfect solution. Through a DST 1031 exchange, you might be able to access the following advantages:
Decreased number of duties – choose responsibilities from the start
If you decide to pursue the 1031 property exchange through the DST, you will have all the flexibility you need to choose from the start the duties you want to have, as well as powers and benefits. Being a landlord is tiring, and it involves much more responsibility than you are able to handle when retired Well, with the exchange, you can discuss with the other parties involved and reach an agreement on your particular role. Delaware statutory trust real estate is known for being extremely convenient in terms of management, so you won’t have to worry about spending all of your retirement time handling all sorts of property management tasks.
Legal protection and no liability
Because your role in the ownership of the property acquired through the DST is no longer essential, while you are still acquiring financial benefits, potential liability due to debts or other complications will not be something to concern yourself with. The legal protection obtained through the right exchange method will certainly give you peace of mind, allowing you to enjoy your years of retirement to the fullest – still a commercial property beneficiary, just with minimal involvement.
While the thought of selling your rental building and acquiring another estate that comes with fewer demands might appeal to you, one aspect that may be holding you back is the thought of having to pay taxes during the entire sale, repurchase process. Well, a 1031 exchange is great because taxes are not a problem here. This program is designed especially to help the parties involved defer tax payment, so while you are switching to exactly the like-kind property you desire, you won’t have to spend an money on taxes.
These are the main factors that should determine you to consider a DST 1031 when you are on the point of retiring as a landlord. Hiring someone to take over your current landlord responsibilities is just as much of a hassle as it would be to keep managing the place yourself, so switching to a property that is more convenient to run, while still offering you monthly incomes is an option that you shouldn’t overlook. Asses the benefits of a 1031 swap carefully, and take advantage of this program when you have the opportunity to.