Someone Discussed A New (To Me) Type Of Investment
Monetized Installment Sale (M453) Transactions. They were formerly called “collateralized installment sale” or “C453” transactions. They are based on Section 453 of the IRS Code.
A Person Has Property With A Low Basis
If they sell, large capital gains. If they do a 1031 Exchange, they have to move to a more expensive property and continue managing property.
This transaction allows them to get money out at no tax (loan proceeds) until the end of the contract (normally 30 years) or death.
Any comments from the financial planners. I understand installment sales and I understand 1031 Exchanges and I understand 1031 Tenants In Common Exchanges, but this 453, not so much.