1031 Exchanges · Delaware Statutory Trusts · Tax Deferral
1031 Property Selection for Accredited Investors
Plain-language education on 1031 exchanges, Delaware Statutory Trusts and capital gains tax deferral, from Toni Sutherland, Registered Representative, Alta Investment Group.
A 30-minute phone call, at no charge. Pick a time and Toni calls you then.
Registered since 1996Securities industry
CRD 2729672Verifiable on BrokerCheck
Series 7, 6, 63, 65Exams passed
Emerson Equity LLCMember FINRA/SIPC
Before any structure is chosen
Three things decide how a 1031 exchange goes
None of them is which building you buy. Each one is settled early, and two of them cannot be fixed after the fact.
The clock, not the property
The 45-day identification deadline and the 180-day closing deadline both start the day your sale closes, and they run at the same time. Until you know how many days are left, nothing about a replacement property can be decided.
Whether the intermediary was engaged in time
A qualified intermediary has to be in place before the relinquished sale closes. If the proceeds reach you, even briefly, the exchange is over, and it is not something that can be repaired afterwards.
Whether you still want to be a landlord
Owners often work out partway through a sale that what they wanted was out of the tenants, the vacancies and the repairs, rather than into another building. That answer changes which structures are worth looking at at all.
Statutory deadlines
Both clocks start the day you close, and they run together
These are rules under Section 1031 and its regulations, not estimates. Extensions are generally unavailable outside a federally declared disaster.
Day 0
Your sale closes
Both clocks start on the closing date of the property you sold. Not the listing date, not the date you went into contract.
Day 45
Identification is due
Written, signed identification of replacement property has to reach your qualified intermediary, which leaves 135 days to close on it.
Day 180
The exchange ends
It ends at the earlier of 180 days or the due date of your return including extensions, so a November closing can land on April 15 instead.
The full timeline, the three identification rules and Form 8824 →
Six considerations
What Investors Weigh in a 1031 Exchange: Tax Deferral, Potential Income, Diversification, and Management Relief
Tax Deferral
A properly structured 1031 exchange defers capital gains tax on the sale of investment property. The tax is postponed, not forgiven, and deferring it can keep more of the sale proceeds working in replacement property.
Diversification
Because DST interests are sold in fractional amounts, an accredited investor may be able to spread exchange proceeds across more than one property, asset class, location or sponsor. Diversification does not assure a profit or protect against loss.
Management Relief
Many long-term owners have grown tired of managing aging rental property. A DST investor has no day-to-day landlord responsibilities, because the sponsor and its property manager run the property. The trade-off is that investors have no say in management decisions.
Ease of Identification
DST properties are typically acquired and financed by the sponsor before interests are offered, which can make identification within the 45-day window simpler. It does not remove the risk that an offering fills or closes before your exchange does.
Larger, Professionally Managed Real Estate
A DST lets accredited investors pool capital with other investors to own beneficial interests in larger, professionally managed real estate than many could buy on their own.
Talk It Through with Toni
Specific offerings are never shown publicly. They are discussed only one to one, after Toni has established that you are an accredited investor and that a DST may be suitable. Book a 30-minute call and Toni will call you at the time you choose.
DST interests are offered only by private placement memorandum to accredited investors. They are speculative and illiquid, distributions are not guaranteed, fees reduce returns, and investors can lose some or all of their investment.
Who is behind 1031 Property Selection
One registered representative, and a phone call
Toni Sutherland is a registered representative (CRD 2729672) at Alta Investment Group in Aptos, California, and has been registered in the securities industry since 1996. Toni has passed the Series 7, 6, 63 and 65 exams. 1031 Property Selection is a marketing name of Alta Investment Group, and this site explains 1031 exchanges, Delaware Statutory Trusts and the related tax rules in plain language. Securities offered through Emerson Equity LLC, Member FINRA/SIPC. You can check Toni's background on FINRA BrokerCheck.
Read first, decide later
Three pages that answer the three questions people arrive with
The deadlines 45 and 180 days, in order
Both clocks, where they start, the three identification rules, and the one filing that actually stops the exchange.
Read it →
The structure What a Delaware Statutory Trust is
How a DST holds real property, why an interest in one can be like-kind replacement property, and what you give up.
Read it →
The gate Whether you qualify
The income and net-worth tests, the professional-licence route added in 2020, and how accreditation gets documented.
Read it →Short answers
1031 & DST Questions, Answered
What is a 1031 exchange?
A 1031 exchange lets an owner of real property held for investment or business use sell it and defer federal capital gains tax (and state tax, where the state follows the federal rule) by reinvesting the proceeds in like-kind replacement property through a qualified intermediary, following the Section 1031 rules and deadlines. The tax is deferred, not forgiven.
What are the 1031 exchange deadlines?
You must identify replacement property within 45 days of selling your relinquished property, and close on it by the earlier of 180 days after the sale or the due date (with extensions) of your tax return for the year of the sale. Both clocks start on the closing date of the sale and run at the same time. Extensions are generally not available except for federally declared disasters.
What is a Delaware Statutory Trust (DST)?
A DST is a legal entity that holds larger, professionally managed real estate and lets multiple investors own fractional, passive beneficial interests with no day-to-day management. A properly structured DST interest can qualify as like-kind replacement property in a 1031 exchange. DST interests are securities offered only to accredited investors, and investors give up control over the property.
See all 1031 exchange & DST FAQs →
Every term on this site, defined →
No cost, no obligation
Request the 1031 and DST packet
Plain-language material on how a 1031 exchange works, what the 45-day and 180-day deadlines actually require of you, what a Delaware Statutory Trust is, and the questions worth asking before you sell. Written for property owners, not for advisors.
Specific offerings are never shown publicly. They are discussed only one to one, after Toni has established that you are an accredited investor and that a DST may be suitable.
- The 45-day and 180-day clocks, and what happens if you miss one
- How a qualified intermediary has to be engaged, and when
- What a DST is, what it is not, and the trade-offs of giving up control
- California's clawback rule and the annual filing it creates
In a hurry, or already in escrow? Book a 30-minute call with Toni instead and skip the reading.
DST interests are offered only by private placement memorandum to accredited investors. They are speculative and illiquid, distributions are not guaranteed, fees reduce returns, and investors can lose some or all of their investment.