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DST (Delaware Statutory Trust) 1031 Replacement

1031-eligible passive vehicle — buy beneficial interest in a DST-owned institutional property, no LLC filings.

Overview

DST is IRS-approved (Rev Rul 2004-86) as replacement property for 1031 exchanges. Investor buys 'beneficial interest,' not deed. Fully passive: no signing on loans, no operational decisions. Common on grocery-anchored retail, medical, industrial, class-A multifamily. $25K–$100K minimums. Ideal exit for aging landlords wanting to preserve step-up basis at death. 721 UPREIT rollup exit option after 2+ years.

Best fit
Retiring landlordsSmall-dollar 1031 exchangersEstate-planning exchangers targeting step-up
Estimated impact
§1031 preserved + step-up at death eliminates all deferred gain

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