TDS’ purchase of appreciated assets from Sellers on an installment sale basis is the legal mechanism which provide Sellers tax deferral.
TDS in implementing these types of installment sale transactions incorporates both TDS’ tax reduction and transaction expertise. TDS’ proprietary expertise allows TDS to often enter into as an intermediary buyer relationship with Sellers – in Seller’s pre-existing sale transaction with a Buyer (‘the “Final Buyer”).
TDS’ installment sale transactions as both an intermediary buyer and in TDS’ installment sale transactions to save a failing 1031 transaction are structured, in the most unique of ways, in order to potentially allow the Sellers to avail themselves of liquidity to potentially access a significant portion of Seller Pre-Tax Net Sale Proceeds.
Sellers of Appreciated Assets by selling to TDS’ in an intermediary installment sale transaction have the potential via a separate loan- credit line transaction to access large portions of their capital. Financial terms for such lines of credit are often more flexible and cheaper than Seller borrowing from most financial institutions.
TDS as an Intermediary Buyer in an Intermediary Installment Sale:
In an Intermediary Installment Sale, TDS as a dealer is buying appreciate assets from Seller and then TDS is reselling them to the final Buyer.
It is most often the case that TDS is coming into an existing sales transaction between seller and buyer. TDS enters into these transactions as an “Intermediary Buyer” and resells to the pre-existing buyer. This is the legal structured mechanism, which guarantees tax deferral to Sellers under the installment sale contract provisions of the internal revenue code.
TDS enters into an installment sale contract and issues a promissory note to the Seller. TDS is buying Seller’s appreciated assets and is only providing Seller with a promissory note. TDS almost immediately resells the asset acquired from seller to the pre-existing buyer, the final buyer.