Structured Sales of real estate in 2018. Rising interest rates make secured installment sales attractive to real estate sellers.

Structured Sales of real estate, offering the ability to pay ZERO taxes in the year in which you sell a highly appreciated real estate asset, are still a highly secure way to defer taxes into future years. In this update Mark Wahlstrom provides a 2018 market perspective on how sellers and brokers can use this highly effective tactic to defer all or part of their capital gains tax bill into future years, all while securing those future payments with a US Treasury backed payment arrangement. Plus, are the rumors of new life insurance companies entering the market going to make this an intriguing growth market opportunity for structured sale specialists and commercial real estate brokers. Watch this video or go to wahlstromandassociates.com to learn more.

Structured Sales of real estate, offering the ability to pay ZERO taxes in the year in which you sell a highly appreciated real estate asset, are still a highly secure way to defer taxes into future years. In this update Mark Wahlstrom provides a 2018 market perspective on how sellers and brokers can use this highly effective tactic to defer all or part of their capital gains tax bill into future years, all while securing those future payments with a US Treasury backed payment arrangement. Plus, are the rumors of new life insurance companies entering the market going to make this an intriguing growth market opportunity for structured sale specialists and commercial real estate brokers. Watch this video or go to https://wahlstromandassociates.com to learn more.

What is a structured sale?

In this informative video I reviewed the concept of structured sales, originally updated way back in 2013 and the market and tax issues we were facing that year.  I looked at the issue of how a structured sale works, the benefit of tax deferral and putting 100% of the proceeds of a real state sale to work vs paying a huge tax bill on the sale of appreciate real estate.

Structured sales, a concept in 2013 that is growing.

Structured sales, a concept in 2013 that is growing.

In the process of a structured sale there are a few key items you need to watch out for:

  • Have you notified the buyer of the property of your intention to structure your sale and provided them the necessary paperwork, information and process that they will need to sign off on to make it work.
  • What funding options do you have for your structured sale? As mentioned in our earlier commentary, the recent decision by Allstate Financial to close their structured settlement division has left a void in the annuity funding option for structured sales using annuity funding. Do you want to wait for a life market to possibly enter the arena in 2018 or does it make sense to look at private funding options through other assignment companies operated by trust companies and using US Treasury obligations.
  • What are you trying to achieve with a structured sale? Is it about just moving money from one tax year to the next, in which case we argue you should NOT be using this process, OR, are you seriously considering a long term cash flow plan using 100% of your proceeds so that your tax hit is spread over many years and is integrated into your business, financial or estate plan?

 

 

Regardless of your situation, we think you need to stay current on structured sales, know how they work and what you need to do to make them part of your real estate selling strategy. Subscribe to our page, like us on Facebook or simply watch these postings for more information during 2018 on the topic of structured sales.

 

Structured sales and 1031 exchange. Can the combination work in 2013?

Does it make sense to use 1031 exchange tactics to "wait out" the current void in the structured sale market caused by the departure of Allstate Financial as an underwriter of structured sale annuity funding programs?

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Mark Wahlstrom, President of Wahlstrom & Associates, examines both concepts, the 1031 exchange and the structured sale, each of which have been around for decades and used successfully in the pre-real estate melt down era of the late 1990's and mid 2000's. However, over the last 5 to 7 years, the collapse of both residential and commercial real estate, coupled with annual concerns about potentially increased capital gains rates, combined to largely smother the potential of this once promising concept of tax deferral and cash flow planning using structured sales.

Interestingly, evidence so far in 2013 suggests that interest in structured sales is surging as real estate prices have begun to rebound at the exact same time as the first substantial increase in capital gains and ordinary income tax rates became law in 2013. More sellers of real estate have been looking for options to spread out the tax hit in a secure fashion and structured sales appear to fill a growing need of tax planners, CPA's and real estate investors of all sizes. In this weeks video Mark examines some timely ideas for those who have pending sales or potential sales and are wondering what options there might be in the interim.

Mark Wahlstrom is the President of Wahlstrom & Associates and one of the nations leading experts in structured sales, Oil & Gas lease bonus structures, structured attorney fee's and mass tort settlement administration.