Deferred Sales Trusts: Tax Deferral Strategies for the Sale of Appreciated Assets

2 IRS CE/CTEC/NASBA CPE*

Course Description
Deferred Sales Trusts have gained increasing attention as a planning strategy for taxpayers looking to defer capital gains tax on the sale of highly appreciated assets. This course provides a practical overview of how these arrangements are structured, the tax rules that support them, and the circumstances in which they may be considered.

Participants will examine the installment sale principles under IRC Section 453, the roles of the seller, trust, trustee, and purchaser, and how gain recognition may be deferred over time. The course will also address the potential benefits and drawbacks of Deferred Sales Trusts, key transaction risks, areas of IRS concern, and important planning considerations for tax professionals advising clients on significant asset sales.

Objective
Upon completion of this course, participants will be able to:

Explain how a Deferred Sales Trust is structured
Identify the tax rules underlying the strategy
Describe how installment sale treatment may defer capital gain
Evaluate situations in which a Deferred Sales Trust may be appropriate
Recognize significant tax, legal, and economic risks
Identify planning issues and potential red flags
Major Topics

Overview of Deferred Sales Trusts
IRC Section 453 and installment sale treatment
Structure and parties involved in the transaction
Timing of gain recognition
Potential planning benefits and limitations
Tax risks and IRS considerations
Comparison with other tax-deferral strategies
Practical planning considerations
Designed For
CPAs, EAs, tax professionals, financial planners, and other professionals advising clients on the sale of appreciated assets

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*Self-Study recording available for IRS CE Credit only (NO CPE)

NASBA Field of Study: Taxes

IRS Program #: 7Q3WU-T-00987-26
CTEC Course #: 6248-CE-00343