CB Administrative Services offers tax-deferring options for any home residence, business, investment property, or other highly-appreciated assets. Read more about how our cost-effective solutions may help your situation.
Learn MoreCB Admin Services is committed to transparency, accountability, and integrity. All of our clients maintain full control of their assets and can fully view their portfolio at any time. We only operate within the IRS guidelines, following the IRC and staying updated within the industry.
The Installment Sale Trust (IST) is 100% IRS compliant, allows cash liquidity, and has been around since the 70s. We are dedicated to making the SIS Trust more available to the public since it has primarily been used in M&A and large business deals in the past.
The IST is an excellent 1031 alternative, acting as a safety net. The Installment Sale Trust also gives investors the option to exit the industry without having to pay capital gains tax on growth or for depreciation recapture.
Home owners that have had their houses for years have likely experienced some appreciation. Some married home owners experience more than $500K in appreciation, giving them an avoidable tax burden.
Business owners have no other way out than paying the capital gains tax. The IST gives these entrepreneurs an option to exit their business with a reliable income and without having to worry about paying a large tax.
An Installment Sale Trust follows IRC §453: you sell a highly appreciated asset to a trust in exchange for a secured promissory note, and you recognize gain only as principal payments are received.
You transfer the asset to the IST in exchange for a secured promissory note. No sale to a third-party buyer has occurred yet, so no tax is triggered at this step.
The IST sells the asset to the ultimate buyer at the same price. The trust takes your sale price as its basis, so the trust recognizes no gain on that sale.
The full pre-tax proceeds remain in the trust. You do not take the cash; your rights are limited to the secured note. That is what keeps the sale on the installment method.
The trust pays interest on the note, taxed as ordinary income. When you take principal, that portion is capital gain under the installment method. Full liquidation is always available — the deferred tax is then due.
See whether an Installment Sale Trust fits your sale, and how CB Admin would administer it.
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