It is what it is. What are your thoughts?

For background:

The IRS released an advance version of Rev. Rul. 2023-2 [PDF 130 KB], which concludes that the basis adjustment under section 1014 generally does not apply to the assets of an irrevocable grantor trust not included in a deceased grantor’s gross estate for federal estate tax purposes.

Section 1014 generally provides that the basis of property in the hands of a person acquiring the property from a decedent or to whom the property passed from a decedent, if not sold, exchanged, or otherwise disposed of before the decedent’s death by that person, is the fair market value of the property at the date of the decedent’s death.

In Rev. Rul. 2023-2, the IRS determined that the basis “step-up” under section 1014 does not apply to assets gifted to an irrevocable grantor trust by completed gift in cases in which such assets are not included in the gross estate of the owner of the trust for federal estate tax purposes. In such cases, even though the grantor trust’s owner is liable for federal income tax on the trust’s income, the assets of the grantor trust are not considered as acquired or passed from a decedent by bequest, devise, inheritance, or otherwise within the meaning of section 1014(b), and therefore section 1014(a) does not apply.

I don’t quite understand. But real estate crowdfunding is considered real estate. Please spend time reading Real Estate Crowdfunding Learning Center and all the posts. It’s a great resource.

Thanks!

Now understand relationships between fundrise and realtymogul/crowdstreet. However, all real estate crowdfunding investment as a whole, it should be classified as part of real estate holding or should classify as a separate assets class? Look like invest in fundrise , because it is an REIT, it has less risk. Classified as part of real estate is fine. If invest in individual project, you are invest in equity, if house price drop you may lose all investment. By this point, crowdfunding may classify as venture capital? Correct me if I am wrong, I think real estate mean small risk, no just tangible house?

That’s my asset allocation preference. But it doesn’t mean it should be your asset allocation. See: Recommended Net Worth Allocation By Age.

My favorite private real estate platform is Fundrise. I think it’s better for investors to invest in funds versus trying to pick individual real estate investments. It’s similar to my belief to buy the S&P 500 index versus buying individual stocks. Fundrise has been around since 2012 and its returns are solid, especially during down years.

However, like stocks, I do like investing about 20% of my stock allocation into individual stocks. Hence, it’s worth checking out both CrowdStreet and RealtyMogul to see what they have to offer. You can invest in individual speciality deals in areas you are more bullish on.