Finding the Right Estate Planning Attorneys and Financial Advisors for a Deferred Sales Trust

Estate planning is a key way to protect your assets, both during your life and after you pass away. If you own highly appreciated assets and want to learn about ways to minimize your tax liability through estate planning, both financial advisors and estate planning attorneys can provide valuable information to guide your decision-making. At 453 Trust Powered by Pennington Law, our team includes estate planning attorneys who are also registered financial planners, giving you the best of both worlds under one roof. 

A key part of estate planning is creating trusts. One such tool is the deferred sales trust (DST), which can spread out the proceeds and capital gains taxes associated with the sale of an appreciated asset over a set period, while offering the opportunity for profits to grow through reinvestment. We call it the Tax Tool You Didn’t Know You Had.

Properly structuring your DST is essential so that it complies with IRS Section 453 rules, helps you achieve potential tax-deferral benefits, and positions you to generate a stream of income from your invested proceeds. Before you act, you should consult someone who understands these powerful financial instruments and how they interact with your overall estate strategy. 

Contact 453 Trust Powered by Pennington Law today for a free consultation for details on why it’s important to hire a financial advisor for estate planning before establishing a DST.

Steps to Finding a 453 Trust and Estate Planning Attorney 

How do you find the right trust and estate planning attorney to help you set up a DST? One way is to solicit references from family members or acquaintances who have worked with estate planning lawyers. If you have working relationships with other attorneys, ask them for referrals to estate planning lawyers with experience in deferred sales trusts and who also offer financial advisory services. You could also search online for attorneys who advertise these services and read reviews.

Once you’ve narrowed down potential qualified counsel, you can meet with prospective attorneys to assess their suitability for your financial and estate planning needs. Look for someone who has:

• Recognized industry credentials and certifications that demonstrate advanced knowledge of financial planning and tax strategies
• The resources or connections to offer a full-service approach to address all your estate and financial planning needs
• Extensive experience incorporating trusts into a comprehensive estate plan  

At 453 Trust Powered by Pennington Law, we employ professionals in estate planning, financial advising, tax planning, insurance, fiduciary matters, and wealth management. Other firms outsource certain tasks to third parties, but our qualified team keeps everything in-house to minimize the risk of miscommunication and errors. Not only does that make good business sense, but it also provides a one-stop shop for strategic assistance with selling an asset, investment, or business.

The Role of a Financial Advisor in Managing a Deferred Sales Trust

Deferred sales trusts are complex financial instruments, which is why attorneys handle the initial setup. A skilled financial advisor can assist with the management of the trust by suggesting reinvestment strategies and tailoring them to your specific financial objective, whether that’s to continue growing the value of your overall investment portfolio or to provide you with an income stream to support you during your retirement. A knowledgeable advisor can actively manage the investment portfolio of a deferred sales trust so it works toward performing in line with your financial objectives and responds to situations that may jeopardize the wealth in your trust, such as underperforming individual investments or broader downturns in industry sectors or the overall economy. 

Why Estate Planning Experience Is Essential to Set Up a 453 Trust

Deferred sales trusts involve complex tax rules and must meet specific requirements to be legally sound. Errors in structuring a deferred sales trust can lead to unintended tax liabilities, interest, and penalties. Rather than put your finances at risk, get help from legal and financial advisors who understand the pertinent rules and can help develop a financial strategy to protect your interests effectively.

Questions to Ask Before Choosing a Financial Advisor for Your DST 

Who you choose as your financial advisor for a DST may be of critical importance to your financial well-being. As you consult with prospective advisors to assist with your deferred sales trust, consider asking the following questions: 

• Are you familiar with the estate planning process?
• What legal and financial advisory services can your firm provide?
• How many deferred sales trusts have you managed?
• Have any deferred sales trusts that you worked with had any legal issues (e.g., IRS audits or imposition of tax penalties)?
• What licenses and certifications do you have?
• Have you received any awards or recognition for your work?

Finally, you might ask whether the advisor would recommend a deferred sales trust or another strategy altogether. Their answer might indicate whether the advisor will focus on selling you products or services rather than identifying and recommending legal solutions tailored to your specific needs, concerns, and objectives.

Common Mistakes to Avoid When Selecting an Advisor

As you consider who to hire for help with your deferred sales trust, avoid these common errors:

• Selecting an advisor with limited or no experience with deferred sales trusts
• Hiring an advisor without the certifications necessary to support you with your deferred sales trust
• Choosing someone who does not have the resources to provide full-service support

Contact Our Team to Learn More About 453 Trusts 

As estate attorneys and licensed financial professionals, 453 Trust Powered by Pennington Law can help you strategize and execute legal documents that work to achieve your needs and goals. Our estate planning team is members of the Forbes Financial Council and recognized as leaders in the legal profession by organizations such as Super Lawyers, Lawyers of Distinction, and Best Lawyers in America.

Learn how a deferred sales trust can be part of an effective estate plan. Contact us today for a complimentary consultation.