The Delaware Statutory Trust Tax Reporting for a DST is exactly the same. The income your receive monthly all gets reported to the IRS at the end of the year. You will receive a 1099 of your income and your CPA will report this income on your tax return on schedule E.

Does a DST file a tax return?

Delaware Statutory Trust State Tax Treatment When owning property out of state, you typically will need to file state income tax returns in that state. The same goes for DST properties unless the property is in a state with no income tax filing requirements, such as Texas or Florida.

Are DST risky?

DST investments are highly speculative and involve substantial risks. No public market is likely to exist for such investments, so it should be understood that there is a lack of liquidity. DST investments are not freely transferable and substantial restrictions may apply to the transfer of interests.

Is a Delaware statutory trust a grantor trust?

A DST is a separate legal entity formed as a trust under Delaware law. If properly structured, the DST will be classified as a grantor trust for federal income purposes and, as a result, the purchaser of a beneficial interest in the trust will acquire an undivided interest in the assets(s) held by the DST.

What is a digital services tax?

Digital service taxes (DSTs) are taxes imposed on multinational firms based on their digital activities in a particular jurisdiction. It is important to distinguish DSTs from other more indirect taxes, such as value-added taxes (VATs), that include certain digital activity in the tax base.

Where can I get a DST for my tax return?

Any DST documents should be given to your tax professional for completing your tax return. Do you have a tax professional to help you with your taxes? If not, we have a directory of CPAs and can introduce you to someone in your area.

Do you have to pay more for DST’s?

Every state has different rules and regulations, so its best to check with a tax professional. Be prepared to pay more overall for adding your DST to your tax filings. More state filings lead to higher preparation fees, which means more money out of your pocket.

Can a DST property be taxed out of State?

The same goes for DST properties unless the property is in a state with no income tax filing requirements, such as Texas or Florida. Typically CPAs will charge clients a few hundred-dollar fee for filing out of state on behalf of a DST investor.

Is it tax season for first time DST investors?

Tax season can be a confusing time of year. As a first time Delaware Statutory Trust (DST) investor, you’ll have an extra layer of confusion to deal with. This article is meant to give you a heads up on what to expect at year-end when it comes to DST tax documents.