Level 14
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Business & farm

While your facts are limited, and this forum is not conducive to discuss all the implications, I am not sure why you are considering using this structure.  I am sure that you could utilize another structure that has fewer complexities to accomplish the same result.


The DST has numerous requirements one of which is that a trustee must be a Delaware resident.  So if you are not a Delaware resident, you will need to use a Delaware Trust Company to act in this capacity.  This adds additional cost.


For federal income tax purposes, the DST can be treated as a grantor trust.  Essentially this means all activity of the DST will just flow through to your 1040.  The DST will, however, need to file a form 1041.  This also adds an additional cost.  


Please do seek some legal advice before venturing into this arena as I seriously doubt that this is the best and only entity structure to achieve your business goal.