An Alternative To The 1031 Exchange
A Structured sale Annuity or "Ensured Installment Sale" is a capital gains tax deferral tool that enables the seller to gain benefits that other sales and capital gains deferral methods do not offer. It is a hybrid of the common installment sale and a structured annuity, and it enables the seller to collect a stream of payments, leverage equity, earn a pre-tax return, and other benefits. This method is a tool for those who want to do a 1031 exchange but cannot find a property within the time frame, and it allows the seller to have a backup plan. However, the capital gains taxes due on the property will still be due once each installment payment is made, thus causing the taxpayer to still pay the tax.
Read more about this topic: Internal Revenue Code Section 1031
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