If the loan defaults in the DST, do you have to pay taxes on the cancellation of debt? (Strategies for Using DST Properties to Replace Debt in a 1031 Exchange)

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Jul 17, 2025 - 04:33 PM

If the loan defaults on a DST or any real estate investment, let's just say like a foreclosure event, right, is what we're talking about here, where an investor owns an investment property, the property gets foreclosed on. How the IRS views that is they actually view that as a sale, right?

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- Residential Lease or Month to Month Rental Agreement
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If the loan defaults in the DST, do you have to pay taxes on the cancellation of debt? Strategies for Using DST Properties to Replace Debt in a 1031 Exchange

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