Tax Deferral Service Question.
Hey guys,

&amp;amp;#x200B;

My firm has started doing a tax deferral service for brokers using a 1031 alternative. I've marketing to groups for about 16 months with no one doing any business with us. we look for sellers that are looking to retire, sell they're business, and not pay taxes. we have a unique way of doing this, but its been hard to get these folks to use are service. mind you we don't take part in a commission of a sale nor get a finders fee. can anyone tell me what brokers are struggling with? is it easier to just do a 1031? Why wouldn't they want to defer taxes for a retired client using our way when the can get paid the same way, but with faster escrow?
[{"id": "eft0j8y", "text": "Are you a CPA? if not, what do you do that a CPA cannot?", "replies": [{"id": "eft0wq3", "text": "Were a full service Brokerage firm. we can defer 100% of taxes and provide an income stream using a number of investments. using the proceeds of the sale.", "replies": [{"id": "eft15m6", "text": "so, what is the difference from a 1031? Diversification? If that is the case, how nasty would unwinding that be?", "replies": [{"id": "eft248i", "text": "well there is no time crunch. No 45 days no 180 days. we use a trust where the seller is protected from taxes. we can take out the money little by little as well if they want the money, and not effect they're tax bracket. but its different for every case. some folks might just want the income and give the proceeds of a sale to they're estate when they pass away.", "replies": [], "depth": 4}, {"id": "efta4h5", "text": "are you a broker yourself? what kind of issues do you face in general?", "replies": [{"id": "eftij1j", "text": "I work for a small real estate debt/equity fund and we tend to play a consultant role a lot. Develop on the side. I don't personally face any tax issues since I don't sell. \n\nWe are working with opportunity fund investments a lot right now, which may be why you are having problems - it basically does what you are doing while creating a CG tax free new investment. \n\n", "replies": [{"id": "eftn247", "text": "Yeah I heard of these \"opportunity\" zones. I wouldn't consider that a competitor of mine.", "replies": [{"id": "efuwjdp", "text": "It is.", "replies": [], "depth": 7}], "depth": 6}], "depth": 5}], "depth": 4}], "depth": 3}], "depth": 2}], "depth": 1}, {"id": "eft619y", "text": "1031 Facilitator?       ", "replies": [{"id": "eft6a14", "text": "We use a different tax code. we have access to these types of groups but its not what we do. we can produce a high percentage of income using securities. Although property can be used in the trust.", "replies": [{"id": "eft73zo", "text": "What tax code specifically?", "replies": [{"id": "eft7dap", "text": ".", "replies": [{"id": "eft82md", "text": "Thanks, I\u2019ll have to check this out. ", "replies": [{"id": "eft88qr", "text": "what do you like about it? are you having trouble with a broken exchange, or a seller that just doesn't want to do a 1031?", "replies": [{"id": "eft8fkf", "text": "I\u2019m getting into real estate and like to have options. Further, I\u2019m a CPA and wasn\u2019t familiar with any other option. ", "replies": [{"id": "eft8hxe", "text": "ah good luck to you.", "replies": [], "depth": 8}], "depth": 7}], "depth": 6}], "depth": 5}], "depth": 4}], "depth": 3}, {"id": "eft7b3g", "text": "were not QI's either. we compete with 1031's some what. but we use a trust we use tax code ... the guys that gave us this prospecting idea have been using it for over 25 years. So were using it to get a retiring business owners money into a trust where we can manage the money and provide an income. very low fees for the seller too.", "replies": [{"id": "efto1cb", "text": "What will you be investing the funds into?", "replies": [{"id": "eftoh9b", "text": "Depends on the seller. But I have access to just about everything under the sun. If the seller is retiring I go with a majority of principle protected income investments.", "replies": [{"id": "efu5lg8", "text": "I'm still not clear as to what part of the tax code this qualifies as a tax deferred exchange. Need more info.\nThx", "replies": [{"id": "efu5xup", "text": "I posted more info in the comments. ", "replies": [], "depth": 7}], "depth": 6}], "depth": 5}], "depth": 4}], "depth": 3}, {"id": "efu0mtg", "text": "I feel like you are be unreasonably vague. Sounds shady... explain yourself in full. No wonder you haven\u2019t received any business...", "replies": [{"id": "efu0xea", "text": "Well I gave the website and tax code. How it works, and why it's good for brokers and sellers. Do you have any specific questions? ", "replies": [], "depth": 4}], "depth": 3}], "depth": 2}], "depth": 1}, {"id": "eftoj2i", "text": "Confused", "replies": [{"id": "eftozot", "text": "Are you a business broker? I guess what I'm trying to say is why would a BB go with a 1031 over my service when I can Defer taxes and get them a check immediately opposed to a 1031 exchange? It's just less work, and a better situation for a retiring seller.", "replies": [{"id": "efttpvp", "text": "I dont understand what you do. Also, spelling/misuse of words - this makes it hard for me to believe you have a competitive advantage for a client over a 1031. ", "replies": [{"id": "eftvype", "text": "Our job is to find the money in motion; i.e. Business, commercial building, private jet, art work etc. Our high net worth tax law firm writes the Deferred Sales Trust and then our trust department buys the assets with a promissory note. Then we sell the asset to a cash buyer who is in the wings. Because there is no constructive receipt on the first sale with the note all the capital gains and depreciation recapture is deferred until the corpus is removed from the trust. CRE Broker gets paid when cash buyer takes he real asset. We then work with the clients time table to suggest investment with the proceeds.", "replies": [], "depth": 4}], "depth": 3}], "depth": 2}], "depth": 1}, {"id": "eftqn5v", "text": "Seems too good to be true. Can you link your website and repeat the tax code? I still don\u2019t understand the mechanism and would not trust this can be done legally. ", "replies": [{"id": "eftr6pu", "text": "Ha I think that might be the problem. I hear that it's too good to be true all the time. https://www.myept.com/Deferred-Sales-Trust ; the tax code is IRC453B.", "replies": [], "depth": 2}, {"id": "eftrjoz", "text": "let me know your thoughts on it. I'm not a cpa or a real estate broker, so you might see something I'm not aware of.", "replies": [], "depth": 2}], "depth": 1}, {"id": "efu242l", "text": "The investments we use is preferred and tax free bonds. For growth we use a wealth management team that manages based on risk tolerance. If they want CD's we can do that too. ", "replies": [], "depth": 1}, {"id": "efvmhvc", "text": "Well you are deferring capital gains but you\u2019re still paying them every time you receive an installment. I\u2019d much rather do a 1031 and have total control over my replacement property. Potentially even 1031 the replacement property when it\u2019s value increases. 1031s let You have all your money earning for you until you want to get out.", "replies": [{"id": "efvns6u", "text": "When you want to stop dealing with tenants, toilets and the trash i.e. get out why pay the taxes then and lower your ability for the highest income annually. Our DST will continue tax deferral and because you have 30% ~ 60% more assets you have higher income. This also allows the next generation to get a step up in basis and avoid the capital gains all together. The idea is to retire. No more chasing down the rent.", "replies": [], "depth": 2}], "depth": 1}, {"id": "efvygjv", "text": "So I read most of the comments and confusion reigns supreme.  There's probably a big problem with your sales there.  People don't like what they can't put their hands around.\n\nWe've done a bunch of alternative energy (mostly solar) for the 30% ITC and 100% depreciation.  It took us a long time to get there though.  We started small because \"it's too good to be true\" and worked our way up into owning high seven figures of the stuff.  Bought from a salesperson like you making similar claims.  But this took 5 years.  So what worked for that guy selling to us was to smart small with a bigger fish.  ", "replies": [], "depth": 1}]