How Does The Income From A DST Investment Get Distributed To Investors?
DST stands for Delaware Statutory Trust, which is a legal entity used for real estate investment purposes. In a DST investment, income generated from the underlying real estate assets is distributed to investors on a regular basis.
The income from a DST investment typically takes two forms: rental income and capital gains. Rental income is generated from the properties owned by the DST, such as apartments, office buildings, or shopping centers. Capital gains are realized when the DST sells a property for more than its purchase price.
The distribution of income to investors is determined by the DST's governing documents, such as the trust agreement. Typically, the income is distributed monthly or quarterly to the investors in proportion to their ownership in the DST. For example, if an investor owns 10% of the DST, they would receive 10% of the income generated by the DST.
It's worth noting that DST investments are structured as pass-through entities for tax purposes. This means that the income generated by the DST is not taxed at the entity level, but rather flows through to the individual investors, who are responsible for paying taxes on their share of the income.
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