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Delaware Statutory Trust (DST)

A Delaware statutory trust (DST) is a separate legal entity created as a trust under Delaware statutory law. In the case where a DST is used for ownership of real estate in a 1031 exchange, it is necessary to comply with the requirements of IRS Ruling 2004-86, so that beneficial interest in the trust is treated as a direct interest in real estate for income tax purposes. You should always consult with your tax advisor about your personal situation. The benefits and risks are similar to a tenant in common. Please review the TIC section for a better understanding of how these work.