The Biggest Frustration With The 1031 Exchange With Stormy Aikins
“In this climate and in this market, everything is priced very high. 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. What we were able to do is do a partial 1031 Exchange.” – Stormy Aikins
Brett:
What was your biggest frustration with 1031? In fact, I think he did a partial 1031. Let’s actually walk through that process as well.
Stormy:
The challenge with 1031 is there wasn’t a property out there for $1.8 million that we wanted to invest in. There was a lot that we were interested in, and that was closer to the 250 to $300,000 range that you could potentially make money on. But in this climate, and in this market, everything is priced very high. You have to be very strategic, and sometimes that 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. What we were able to do is do a partial 1031 Exchange. 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 purchase the law for $300,000, and then the remainder of the money went into the tax-deferred sales trust.
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. 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 sticking it and something where you wouldn’t have that opportunity. we have the chance to continue to grow and make money. Whereas if you’re kind of pigeonholed within that tight timeframe in the market that we’re in, you just don’t have that opportunity.
Brett:
Stormy, you’re so smart, and I feel proud of our team. Because I see you’re committed to learning the process. But look at the deal just closed last week. You’re still in it, we’ve been talking with a team and you and Jeremy for about five months or so. But the way you put that so well, and succinctly I really appreciate I want to just draw out a couple of things, as he said there so our listeners can really glean what she just said. 1.8 million, and the 1031 exchange, you have to equal or greater value and typically equal or greater debt. That’s the old blockbuster way it kind of can pigeonhole you. Stormy and Jeremy found a nice piece of land that they want to develop. 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, and traditional 1031 exchanges. She was able to accomplish what they wanted to do on a deal that 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 a decision financially, because of the blockbuster.
Remember having to go three days to return the video, sometimes it’s not rented versus Netflix. Now with Deferred Sales Trust, 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, labour costs, or just the time and energy takes to get things through right now with cities. It’s not automatic, you can just build right away with permits, it takes time. The Deferred Sales Trust give 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. It’s a new way of doing things, it is a little more complex. But guess what 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. Stormy, any other thoughts on that or anything you want to mention on that?
Stormy:
Just credit to the team with I believe it was exchange solutions that you offered that to our friends, and they were great and it actually ended up being a smoother process. I was prepared for anything because it was new. 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.
Closed Deal Story
Can I Save Capital Gains Tax When Selling Cryptocurrency? The answer is, “YES.”
Silicon Valley Technology Expert Finds A ‘Deferred Sales Trust’ To Break Open A Clear Path To Sell Cryptocurrency To Defer Capital Gains Tax
Can I save capital gains tax when selling cryptocurrency? The answer is, “yes.” About 7 years ago, Peter and his wife purchased their first Ethereum. Who would have anticipated that the value would have increased by thousands of percent in just a few years? Peter, who has worked in the technology field for more than 20 years, saw a great opportunity to sell in late 2017, however, without a clear legal plan to defer the large capital gains tax, found himself feeling trapped by the consequences of selling.
Peter held on to his belief in the fundamental value of ethereum and the potential business opportunities it brought to end-users during the 2018 crash when the value of ETH fell from $1,432 to below $90. “That was a tough pill to swallow,” Peter continued. Fortunately, everything returned in 2021, and much more. In early 2021, Peter met Jessica Lanning of Lanning Financial who told him about the Deferred Sales Trust and introduced him to Brett Swarts of Capital Gains Tax Solutions. Then in May of 2021, ETH reached an all-time high of $4362. “I knew it was time to sell at least a big portion of my stock since I didn’t want to miss this opportunity again. Let’s just say it’s been a long three years since the high in 2018.”
Read The Full Case Study Here
Join Our Crypto Capital Gains Tax Mastermind
Create a clear Deferred Sales Trust exit and wealth plan for your sale at the Capital Gains Tax Solutions Mastermind Livestream
Every Friday at 10 am PST/ 1 pm EST
Register for free CLICK HERE
Want to learn more? Check Out The Blogs Below!
- Can a Deferred Sales Trust Be Used for Mergers and Acquisitions?
- How to Defer Capital Gains Tax When Selling Your Cryptocurrencies
- Need An Exit Strategy? The Deferred Sales Trust Might Be the Answer
