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5 Reasons Why the Installment Sale Trust (IST) is the Ultimate Exit Strategy for Business Owners and Real Estate Investors

5 Reasons Why the Structured Installment Sale Trust (IST) is the Ultimate Exit Strategy for Business Owners and Real Estate Investors

December 07, 20233 min read

1. Tax-Deferral on Entire Sale with Growth

First and foremost, the IST shines in its ability to defer taxes on the entire sale of your asset. Imagine selling your property or business and not having to immediately cough up a significant portion of your profits in taxes. Instead, the IST allows you to spread this tax liability over time, aligning with the receipt of your installment payments. This isn't just a delay in tax payment; it's a strategic move. By deferring taxes, you're essentially enjoying an interest-free loan from the government on the tax amount. This allows your entire sale proceeds to work for you, potentially growing through other investments, rather than losing a chunk upfront to taxes.

2. Passive Income at 6% + Trust Growth

The IST isn't just about delaying taxes; it's a powerful tool for generating passive income. Typically, the trust can be structured to provide a steady income stream at a rate of around 6%, which is a respectable return in many markets. But there's more – this income is complemented by the potential growth of the trust's assets. Whether the trust is invested in stocks, bonds, or other vehicles, this growth can provide an additional layer of financial security and income, making the IST an attractive option for those seeking both stability and growth.

3. Allows Re-entering a Business or Real Estate if Needed

Flexibility is key in business and real estate, and the IST offers just that. One of its unique features is the ability to re-enter the business or real estate market if an opportunity arises. This means that if you sell your property or business and later find a lucrative opportunity to jump back in, the IST doesn't lock you out. You can strategically use the funds within the trust to reinvest, ensuring that you're never missing out on a golden opportunity due to a lack of accessible funds.

4. Cash Liquidity (You Can Exit the Trust at Any Time)

Cash is king, and liquidity is its crown. The IST provides an exceptional level of liquidity compared to other financial vehicles. Need to access your funds for an emergency or a new investment? You can exit the trust at any time, giving you the cash liquidity that many other investment strategies lack. This feature is particularly appealing for those who value having control over their financial assets and the ability to respond quickly to changing circumstances.

5. Generational Wealth & Income

Finally, the IST is not just about your financial well-being; it's a tool for generational wealth and income. By structuring your assets and income streams through an IST, you're setting up a legacy that can benefit your family for generations. The trust can provide a steady income for your heirs, and its growth potential means that this legacy can increase over time. It's a way to ensure that your hard-earned wealth continues to serve your family, providing financial security and opportunities long after you're gone.

Thinking About Using an IST for Your Next Sale?

Visit our Revenue Estimator and take the first step towards a smarter, more profitable exit strategy. By filling out this simple tool, you'll gain insights into what an IST could mean for your specific sale scenario.

What Can You Expect?

  • A tailored report that breaks down the potential financial outcomes of using an IST for your sale.

  • Personalized insights that help you understand the impact of an IST on your financial future.

Have a Quick Question?

Whether you're a seasoned real estate investor or a business owner looking to maximize your sale's value, our Revenue Estimator is the perfect starting point. Don't leave your financial future to guesswork. Get a comprehensive view of what an IST can do for you.

👉 Fill out the Revenue Estimator Now and embark on a tax-free journey with an Installment Sale Trust!

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