From Airbnb to Deferred Sales Trust for the Win w/ Stormy Aikins

Stormy Aikins is a Certified Registered Nurse Anesthetist. She worked way up into leadership for that role and she enjoyed it. Her husband has a family-owned dairy distribution business, it started in 1976, they distributed little half-pints of milk to the schools and various restaurants around the valley.

She and her husband have always had entrepreneurship at their heart. They got into some real estate and rentals. And it found that that had done quite well, branched out into a couple of rentals in Phoenix Metropolitan area and into Parker.

She and her husband are now a client of capital gains tax solutions. And they’re here to share their story from Airbnb to Deferred Sales Trust for the win and their challenges, what they liked, what the Deferred Sales Trust.

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From Airbnb to Deferred Sales Trust for the Win with Stormy Aikins

Brett:

I’m excited about our next guest. She and her husband are now a client of capital gains tax solutions. And they’re here to share their story from Airbnb to Deferred Sales Trust for the win and their challenges, what they liked, what the Deferred Sales Trust with some of the concerns were, and just their overall experience so far, with our team here. And I think it’s always great to hear from folks who are closing these deals. And so that’s what we’re going to share here. Please welcome to the show with me Stormy Aikins. Stormy how are you doing?

Stormy:

I’m great. How are you today?

Brett:

I am fine. Thanks so much for joining us. And you’re out of the very warm, warm state of Arizona. You know, California has been on fire. How are you guys doing out there? What’s the weather like? We’re recording this in mid-August?

Stormy:

Yeah. So they put most of the fires out nicely. We had quite a bit of rain. So that helped a lot. But it’s a great day today. Nice, overcast.

Brett:

Perfect. Excellent. There are a lot of people in California moving out to Arizona. It seems like Arizona, Tennessee, Florida, Texas. Are you feeling like everyone’s flooding the great city of Phoenix?

Stormy:

Yeah, it’s really interesting. And it’s changed a lot of the climate in real estate. And just in general, because, as you mentioned, we had gone into the rental business, and it was actually very challenging to even pick up anything because there was a lot of cash buyers coming in a lot of them working in California, they would buy things unseen. So it was a challenge.

Brett:

Kind of wild. When people were just, buying stuff, sight unseen way over asking price, which we’re going to get into your deal here in a minute to kind of go through what you were up against with, the 1031 options, and end up using the Deferred Sales Trust. But before we go into all of that, I like to have our listeners and get to know you a little bit more. So would you tell me a little bit more about your story and your husband’s story? And then kind of your current focus right now?

Stormy:

Yeah, absolutely. So my husband actually has a family-owned dairy distribution business, it started in 1976, they distributed little half-pints of milk to the schools and various restaurants around the valley. As grown it done very well, he always wanted to be a baseball player. So it wasn’t his dream job. So it’s he’s been an entrepreneur at heart. So he’s doing very well at that, but looking to grow the business and then ultimately sell it and spend more time with our children. I went into health care. So I’m a CRNA, nurse anesthetist. And it worked my way up into leadership for that role, and really enjoyed it. But we have always had entrepreneurship at our heart, hard workers and have always been raised that way. So we looking at the valley here and how it’s grown, got into some real estate and rentals. And it found that that had done quite well. And there’s a lot of tax benefits with that and just kind of diversifying everything. So we had branched out into a couple of rentals that were near the Phoenix Metropolitan area, realizing that it was a great opportunity for this growing area for areas that were like Sedona or Flagstaff that were just a couple hours away, but nice cool weather. So it got into doing rentals in that area and then also branched out into Parker. So just kind of diversifying there and then look at the continue the adventure.

Brett:

Excellent. So professional health care professional and then your husband and this business has a business still owning real estate for some tax benefits, building some wealth. And so you come and you buy a property and then tell us a little bit about the property that you purchased, what was the plan and kind of what unfolded with the rapid appreciation?

Stormy:

Sure. So realizing the Sedona was a very desirable place and just being you know, a family looking for rentals and places that were fun to just getaway for the weekend. It was really difficult to find anything so you know, the thought was, well, it if there’s a market out there, let’s see if we can purchase something. So looking at the Sedona area, we put in bids on multiple houses, and it was really challenging to get anything if you weren’t a cash buyer. So we found a new subdivision and it was a beautiful property that had, Oak Creek running through it. And so we purchased a home up there and looking to do Airbnb, some rentals with that, and then be able to use that as a weekend, retreat every once in a while so that we can have that opportunity since it was really challenging to compete with all the other people that were trying to get rentals as well. So branched out into that purchase of the home. And then it actually ended up being more challenging than we had thought for this new community. The neighbors were, you know, it was a higher-end community. It was really nice. But it was a difficult rental because just the neighbors were challenging.

Brett:

It always challenges you, when you’re buying houses, and you’ve got the folks that are doing some rental so he could understand where they’re coming from. But yeah, at the same time it can mess up the plans a little bit because you had a certain potential income stream coming there. And Airbnb is so popular right now. And rates are way up. And so yeah, but keep going.

Stormy:

Yep, absolutely. So having those challenges, and we’re like, okay, we can navigate this, we had a great property manager. And you know, it would just be working with the HOA and things like that. But fortunately, in the interim, there was a gentleman who I believe was from Silicon Valley as well. And he found the area to be very enticing. And so he bought the house on the hill above us for I believe it was like $4 million, double what the asking price was, and really liked the community. So he started buying up houses in the community. And so we posted ours, we purchased it for 1.3. and posted it that far too, and ended up selling it for 1.8 to this gentleman who bought it for I believe it was his mother in law. And he had bought four or five other houses in the community. So we’re like, this is perfect. The timeline though it was six months. So we would have been definitely up against the Capital Gains Taxes. And I had listened to actually a podcast with you. And I believe it was Buck Joffrey because he’s in the healthcare field too. And so it was just something that was very interesting and just realized what a gem and what a unique find this capital gain solution was. And I’d looked into that originally for selling the business because growing it from, a family-owned business, there’s a significant amount of Capital Gains involved. And so looking at that, and then I actually was able to reach out to you and say, we have this property, we’ve sold it and the rest is history, it worked out beautifully. So you know, saved hundreds of 1000s of dollars in taxes by being able to work through this Capital Gain Solution. And that actually ended up being able to purchase a small lot to build on in the future. So it worked out beautifully.

Brett:

Yeah, it’s a nice thing, you can have an extra, typically 30 to 50%, depending on the depreciation, recapture what state you’re in, and Biden’s proposal goes through considering doubling from 20 to basically 40 on the federal she’ll be 50 to 70. So to think about that is staggering. You buy something you take the risk, it doesn’t necessarily work out on the rental side, but you have oh my gosh, the appreciation is so high. And now that huge amount is just going to be gone, versus being able to defer that and build and create and preserve more wealth, which is really financed fascinating and really amazing. It’s why we believe what we’re doing. So for you, though, what was the biggest thing to overcome? Because you’ve been in real estate for a while and you start, 1031 exchanges, and so you hear on Bucks, podcast, me on the show, so what was the biggest thing that you felt like you and Jeremy had to overcome?

Stormy:

I think it was just trust, I think it was just learning more about the process. And if I’ve learned anything, and my life and healthcare and everything that I’ve done is that education is very powerful when you have to really understand and so also with Tom Wheelwright is another very brilliant gentleman that goes over taxes and just realizing that it doesn’t have to be scary. Don’t be afraid of it, learn to educate yourself. And so I think just really being engaged in it and just taking everything in and doing your due diligence. And then you know, it’s trust, ultimately and the team but understanding how well it had worked out for so many others before me really helped. And, and then just really in being engaged in the process and, and moving forward.

Brett:

Perfect. Love that. Yeah. I mean, I imagine you’re in the healthcare industry. There’s, there’s stuff that you have to learn instead of you have to do this really scary. And that’s life and death with what you do, right versus just finances. We’re very serious as well. So how does your background help with To a high level of education, working at the Mayo Clinic, and being in your, I want to make sure I pronounced right, nurse and you do the last part?

Stormy:

Anesthetist.

Brett:

Yeah, so tell us a little bit more about that. I mean, what’s been the scariest moment? Or maybe even the most rewarding moment? Or themes in your career? Just kind of curious about that background?

Stormy:

Yeah, absolutely. So, being a nurse anesthetist you start in nursing and then go to an advanced degree from there. And I think going through all of it, I learned that anything is possible if you’re committed, and you’re willing to learn and you’re willing to be 100% engaged. And, and, and that’s whatever path you choose. And I think as I went through anesthesia school, I realized, wow, if you were really committed to being a rocket scientist, and you study day and night, you could do it. So, you know, using that. And then also, this last year with COVID has taught us how to be humble and flexible, pivot, and learn new things. And that nothing is set in stone. And so, I think I’ve used that, and what I’ve been able to accomplish, and in my personal life, with healthcare, also with helping with some business strategies, so just really being open and flexible, and, and being humble and realize, especially in finance and taxes, the more I learned, the more I realized, I don’t know, and that there are professionals out there and that you have to be able to put some trust in them. And, and move forward. Because a lot of things that you accomplish are with a team. So you know, it’s no one person that’s going to accomplish this. And that’s in healthcare, that’s business. That’s everything. So you really got to be able to find, talented in visuals and you know, work together.

Brett:

Yeah, absolutely. Thank you so much for sharing that. And it’s really, it really is the team. And that’s the key and everybody working together to bring their expertise. And the team need also involves you as the client. Because we’ve all on this Deferred Sales Trust is not jus, setting up an LLC and just transferring or setting up a living trust and just transferring it’s, it takes a team of professionals, I as the trustee, the financial advisor, the tax team are all separate entities. And even you as the note holder. Because in this scenario, you and Jeremy have loaned the money to the trust in exchange for a promise of the trust to pay you back over time. And but you have to make decisions on investments and payouts and but everyone working together, the transformation happens with the flexibility. And by the way, it’s not unlike an IRA or unlike even a 1031 Exchange. These things are all in place that is 401K’s are different things that take a team of professionals, separate entities to help it make sense, and actually, hold integrity for that for the trust itself. So very, very cool. Thanks for sharing a little about your background. Okay, so. So now, what is the vision for the future, versus just doing the 1031? Maybe we can also just touch on that real fast. So someone would say well, stormy, Jeremy, you guys are young, and you’re doing deals? Like, why not just do the 1031 Exchange? What was your biggest frustration with the 1031. And in fact, I think he did a partial 1031. So let’s actually walk through that process as well.

From Airbnb to Deferred Sales Trust for the Win: “Everyone wants a piece of land. It’s the only sure investment. It can never depreciate like a car or washing machine. Land will only double its value in ten years.” – Sam Shepard

Stormy:

So the challenge with 1031 is, there wasn’t a property out there for $1.8 million that we wanted to invest in there, there was a lot that we were interested in, and that was closer to you know, 250 $300,000 range that you could potentially make money on. But in this climate, and in this market, everything is priced very high. So you have to be very strategic, and sometimes that 1031, that 45 days, you just don’t have an opportunity to find something that you’re going to make even more money on. So what we were able to do is do a partial 1031 exchange. So for the property making $500,000, we were able to purchase a lot that we’re able to build some storage units on that have living quarters, so purchased the law for $300,000. And then the remainder of the money went into the Tax-Deferred Sales Trust. So the benefit with that is there’s some there’s liquidity with that where you can do partial investments, but you are able to get that money back out within a couple of weeks timeframe. So when we go to start doing construction on these lots, we can partner with a Tax-Deferred Sales Trust and build the lots and then be able to make money off that versus just taking the money and just stick in it and something where you wouldn’t have that opportunity so we have the chance to continue to grow and make money whereas you know, if you’re kind of pigeonholed within that tight timeframe and the market that we’re in you just you don’t have that opportunity

Brett:

Stormy, you’re so smart and I feel I feel proud of our team, because of a lot of it you’re committed to learning the process. But look at the deal just closed Last week, you know, so you’re still, as I said, we’ve been, we’ve been talking with the team and you and Jeremy for about five months or so. But the way you put that so well, and succinctly, I really appreciate it. I want to just draw out a couple of things that you said there. So our listeners can really glean what you just said. So one 1.8 million right and 1031 Exchange, you have to equal greater value is typically equal or greater debt. That’s the old blockbuster way it kind of can pigeonhole you, right. So she and Jeremy found a nice piece of land that they want to develop on. But guess what that was a lower price, they were able to do a partial 1031 Exchange, which is cool, because the deferred sales trust can work hand in hand with Delaware Statutory Trust, an additional 1031 Exchanges. And so she was able to clearly accomplish what they want it to do and deal that it made sense for them, they had a good business plan versus saying, Oh, we can’t do that, because we have to do 1.8 million, we have to make a poor decision or less of decision financially, because of the blockbuster, remember having to go three days to return the video. You know, it’s sometimes it’s not rented versus Netflix now, with Deferred Sales Trust, she was able, they were able to buy the property, and then they’re able to partner with the trust when it makes sense to develop it, which could be tomorrow, it could be six months from now, lumber costs, labor costs are just the time and energy it takes to get things through right now with cities. It’s not automatic, you can just build right away with permits, it takes time. So with the deferred sales trust, give Sturm stormy and Jeremy is the ability to have time, and to also earn interest on those funds in the meantime, stocks, bonds, mutual funds, hard money, lending, different opportunities there, keep it liquid, and then when and if they’re ready to build, guess what? Those were available, all tax-deferred to build from the ground up. So it’s a new way of doing things, it is a little more complex. But guess what the 1031 might be taken away. And guess what, the times are changing. And we have to adapt, and like he said, pivot and find new ways to build wealth, and not be fearful of leaving the past, which I so appreciate so strongly. Any other thoughts on that? Or anything you want to mention on that?

Stormy:

No, absolutely. And then just credit to the team with, you know, I believe it was exchange solutions that you offer that reference, and they were great. And it actually ended up being a smoother process, you know, I was prepared for anything because it was new. So I’m like, okay, you know, I can figure this out. But it actually was a very smooth process, and credit to the team that it worked out so well and ended up being smooth.

Brett:

Yeah, absolutely. That’s a plug, by the way, we work with 1031 Exchange qualified intermediaries. Some people think, Capital Gains Tax Solutions, we are and we are in competition, in one sense for 1031 companies, but there are those that we send all of our business to, there’s a couple of them because they know the process. And so if you’re 1031, qualified intermediate listening to this, we want to educate you and your team and the process so that you can offer it to your clients. And we can also send you business. Because we’re not a Qualified Intermediary, we do partner or strategically aligned with those who are and so that’s exchange solutions. And they and feel free to reach out to us and we can make the connection there. Okay, awesome. So now you’ve sold now you’ve deferred, and now you have a plan to build. And but now, let’s fast forward to the next potential deal, which is the business sale, which could happen and talk about, and if our listeners remember, 1031 Exchange does not work for business sales. Okay? So now this becomes the only potential as you want to give it to all the way to charity, which you can transform into trust, but zero bases, mid one and a half to $2 million sales, what is it going to mean for you guys, or what he projected means for you guys to be able to sell tougher and buy more real estate as well?

Stormy:

Yeah, absolutely. So a lot of life’s work has gone into this business and growing it over the years and a lot of risk to so for business owners. It’s very different than me and healthcare. So I have a 401K I have a retirement plan, I have a nice pension, things like that. But for business owners, you really count on that you be count on being able to sell the business and, and that’s basically your retirement plan. So a lot of what my husband and his parents have accomplished and grown this business, really, you’re counting on that for your retirement, and for over half of that to go to pay taxes is challenging, because there’s a lot of blood sweat, and tears that went into that. So this is a tremendous opportunity to be able to have these tax incentives to be able to roll that into different opportunities where, whereas otherwise you would just write a very large check to the IRS.

Brett:

Yeah, remember to the IRS actually likes this because what Stormy and Jeremy gonna do is, instead of let’s say they sell the business for 2 million bucks, and they pay, let’s say, five, or 600,000 attacks. And then let’s imagine they you know, some people could just go necessarily sternotomy What’s going on? As all the 2 million is going to be deferred, as long as they put it into businesses and stocks and real estate, which it’s all business purpose, not personal, like primary home kind of thing. It spurs economic growth is surge construction and spurs rent, it spurs jobs, which creates more tax revenue. So it’s one of the biggest misconceptions that these things are somehow frowned upon by the IRS, they actually know that they know it, they looked at it, and it’s 1000s of closes billions under management, 25-year track record, and they say, we want to incentivize you to do things that actually spur economic growth and create more tax revenue. And that’s exactly what it does. The flip side of that is they never sell the business, we actually have, we’re working on a big deal right now out of Florida. And the client hasn’t sold the business for this exact reason. And this is 10s of millions of dollars. And therefore all of that value, I think of it as an oil rig, right. And imagine you own a big old plot of land outside of Phoenix. And there’s just oil sitting underneath there. But unless you tap into that, that oil doesn’t shoot out and produce, income or produce jobs. It’s the same thing with some of these businesses, their ROE, their return on equity could be pretty low. And because the value is so high, but they can’t or feel like they are trapped to sell because of the Capital Gains Tax, right. And so now, it unlocks this, it’s like plugging a hole and getting the oil coming out, which creates more jobs, more tax revenue, and it helps them accomplish what they want to do. So this is what the Deferred Sales Trust is what it does, and why the IRS again, has looked at it over a dozen times. And there have been zero changes. It’s been perfect for 25 years. And so we invite you to go to CapitalGainsTaxSolutions.com to learn more, that’s CapitalGainsTaxSolutions.com That being said, Stormy, are you ready for the lightning round?

Stormy:

Sure.

Brett:

All right, knowing what you know, now, if you could go back to your 25-year-old self or your 20-year-old self, we don’t, whatever it might be a younger self, what’s the one Golden Nugget you’d make sure to tell yourself to do?

Stormy:

Invest in your own education. You know that’s a huge, huge pearl. And I figured that out as I as I’ve learned, and as I’ve gone through anesthesia school and got into the business, and then kind of branched out and realize that that’s really the key that unlocks everything, and find experts in their field, no one person is going to know it all. But there are a lot of experts out there that you can really use those great resources and just really invest in yourself and trust your team.

Brett:

Beautiful, love it. Second question, what’s the number one book you’ve recommended or gifted the most in the past year?

Stormy:

I love Tom Wheelwright. It’s a Tax-Free Wealth book. I really love that.

Brett:

I’m in the middle of that right now. It’s amazing, so many golden nuggets in so many aha’s. Absolutely. Question number three. What are you most curious about right now?

Stormy:

Oh, I’m most curious about our future. I’m curious how this COVID is going to shift everything I know it’s going to change. There’s a lot of political changes, you know, COVID at the midst of it, and there’s a lot of impacts that are going to affect small businesses, and it’s going to affect healthcare. And so I think it’s just understanding what I need to do and what I need to learn in order to be prepared for that. Because you’re never going to change the world. by you, you can prepare yourself and put yourself in a good position for the future.

Brett:

Beautiful, which leads to the next question. What’s your number one? What number one leadership quote or theme that you strive to live by?

Stormy:

Oh, goodness, wow. I’m so I believe, I don’t know if this is a leadership quote. But I work a lot with children that have cancer. And that’s kind of a close spot to my heart. And there was a young boy who came in and had brain cancer, and he just had the greatest attitude. And he was so inspirational. And you know, and we work on these problems and politics and things like that. But when it comes down to it, he had a major, major medical issue, and he was just a he was amazing. And his favorite movie was Lorax. And one of the quotes from Lorax was unless somebody like you cares a whole awful lot, nothing is going to change. It’s not. And so I think it was just really inspirational, that you know, just stay engaged. And at the end of the day, humility is a huge thing. Work hard and be humble. And so I think that’s something that I really, I really enjoyed.

Brett:

That is a beautiful Stormy. Aikins, I want to thank you for being a client of mine, choosing the deferred sales trust putting your trust and faith in our team, a tax team, and business partners and I want to just thank you for sharing your story and lots of inspiration I got a chance to get to know you more. I know our listeners enjoyed it as well and another’s those that are looking they’re out there right now considering the deferred sales trust and this interview will be the difference for them to say yes. And so one last thought from you for them who’s on the Fans. What would you say to them right now?

Stormy:

I would say trust the team. Absolutely. Because, if one thing we’ve learned is there are experts in every field and you really have to be able to trust the team and go for it because there are great opportunities. And this is a brilliant, brilliant idea that this team came up with, and I just can’t thank you enough.

Brett:

Beautiful Stormy, thanks for being on the show. And I want to thank our listeners also for listening to another episode of the Capital Gains Tax Solutions Podcast. Also streaming on expertcresecrets.com or we believe most high net worth individuals and those who help them they struggled clarifying their Capital Gains Tax Deferral Options, not having a clear plan is the enemy, and using a proven tax deferral strategy such as the Deferred Sales Trust is the best way to take your Airbnb property that doesn’t work out because of the HOA in Sedona, Arizona, wanting to build property, all tax-deferred and grow wealth is the best way to do that. And so hopefully you glean that from Stormy story today and we so appreciate you out there please rate review subscribe. Please reach out to us you can go to capitalgainstaxsolutions.com. That’s capitalgainstaxsolutions.com to learn more about all of this as well if you are a business or if you’re a luxury realtor, you’re a commercial real estate broker m&a adviser. You are looking at the Deferred Sales Trust to help your clients to have transformational stories like Stormy and Jeremy’s you can go to experttaxsecrets.com, it’s experttaxsecrets.com to learn more about that. Thank you, everyone, for listening and bye.