Andre Pennington Publishes Article in Forbes Magazine

Pennington Law’s founding attorney, Andre Pennington, recently published an in-depth article exploring the advantages of deferred sales trusts as a tool for minimizing capital gains tax liability on real estate. The article, published Oct. 10, appeared in Forbes Magazine. 

In the report, Pennington detailed how the capital gains tax can drastically reduce profits when selling a highly appreciated property and how sellers can use a deferred sales trust (DST) to spread out their capital gains tax liability. 

He also discussed the strategy of using the proceeds from a deferred sales trust to fund a life insurance policy. An irrevocable life insurance trust (ILIT) can hold a life insurance policy with premiums paid from the DST payments. This technique allows for a tax-free death benefit paid out to heirs and eliminates the capital gains tax burden, allowing beneficiaries to receive the full value of the estate without tax consequences.  

Pennington also emphasized the importance of working with an experienced wealth attorney and financial professionals to ensure compliance with IRS regulations. Errors in setting up the trust, poor management, or bad investment decisions could have costly and damaging consequences.  

To learn more about combining deferred sales trusts and life insurance into an effective wealth management and estate planning strategy, schedule a free consultation with Pennington Law, PLLC today.