Selling an inherited historic property often brings financial opportunity mixed with tax complexity, but a Deferred Sales Trust (DST) can help you preserve both flexibility and value. When you inherit real estate, the step-up in basis resets the property’s basis to its fair market value at the time of the owner’s passing; however, any appreciation that occurs afterward can still result in a significant tax bill. A DST lets you sell the property without triggering capital gains tax immediately, allowing you to reinvest the full proceeds while paying taxes slowly over time. This is especially valuable for historic properties, which often come with preservation rules, slow sales timelines, and required restoration approvals that make quick sales difficult. Instead of feeling pressured to sell fast or accept a lower price, a DST gives you breathing room to exit on your terms. By structuring the trust before listing the property, you maintain IRS compliance and gain access to reinvestment opportunities, diversification options, and enhanced estate planning. The result is a strategy that transforms a potentially overwhelming inheritance into a protected financial asset, enabling you to honor the property’s past while positioning your family for long-term growth and generational wealth.
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