The short answer
On the offerings we describe, 80% to 90% of the exchange value you place in the trust can come back to you as cash after the trust's refinance, at a point the offering defines rather than at the exchange closing. That range is a description of structure, not a promise: the actual amount is set by the offering's loan terms and the property's value at the time. The cash is borrowed money, so it is not income when received, but it leaves you with only 10% to 20% of your original equity and a larger loan ahead of you. Our cash out DST page describes the structure.
At a glance
| Cash out range on our page | 80% to 90% of the exchange value invested |
|---|---|
| When | After the trust's refinance, at a defined point after the exchange closes |
| Distributions before then | None; rent services and amortizes the loan |
| Loan type | Non-recourse; only your invested capital is at risk |
| Tax on the cash | Loan proceeds are not income when received |
| Equity left in | Roughly 10% to 20% of what you invested, plus any later value |
| What decides the figure | The offering's loan documents and the property's value at refinance |
The 80% to 90% figure is a share of what you put in, paid after the refinance
Our cash out DST page puts it this way: after the DST's refinance, you can receive 80% to 90% of your exchange value as cash. Our cash out DSTs explained article describes the same step as extracting a large percentage of original equity, often 80% to 90%, after a defined period.
Those trusts are built for it. They hold triple-net leased property with investment-grade tenants on long leases, financed at high leverage, and all operating income goes to debt service and amortization, so investors receive no monthly distributions. The cash comes from the refinance, and the rest of the value comes at sale.
No figure on our pages fixes the waiting period before the refinance; the offering documents do, and they are the place to read it.
What decides the number in a particular offering
The amount is a loan, so it is sized by a lender against the property, not by the size of your exchange. Three inputs matter: the loan terms already written into the offering, the property's value and lease when the refinance happens, and how much of the original loan has amortized by then.
The trust's structure limits who can change those terms. Rev. Rul. 2004-86 lists the power to 'renegotiate or refinance the obligation used to purchase Blackacre' among the powers that would turn a trust into a business entity. Ask the sponsor exactly how and by whom the refinance is done, and read that section of the memorandum and its tax opinion before you subscribe; the zero cash flow structure explained lists the documents to request.
Risks belong next to the range. A tenant default, a weaker property value, or tighter credit at the refinance date could reduce or delay the cash, and the loan is the first claim on the property.
Worked example: $500,000 placed in a zero cash flow trust
Hypothetical. You place $500,000 of exchange proceeds in a zero cash flow DST. Applying the 80% to 90% description, the refinance would return $400,000 to $450,000, and you would keep an interest worth the remaining $50,000 to $100,000 of equity, plus or minus whatever the property gains or loses.
Nothing is distributed before the refinance, and nothing after it until the property sells. Your share of the larger loan is now ahead of your equity, and the sale has to repay it before you receive anything.
Run your own numbers with your CPA, using the offering's own loan schedule rather than the range.
- Invested: $500,000.
- Cash at refinance, on the described range: $400,000 to $450,000.
- Equity still at work: about $50,000 to $100,000, plus or minus value change.
Size the trust to the cash you need, not the other way round
Because the refinance returns a percentage of what you invest, work backwards: divide the cash you need by the low end of the range to find the subscription, and put the rest of the exchange into income-paying investments. Needing $200,000 on the 80% end points to a $250,000 subscription.
That pairing also keeps the debt side of the exchange working. A highly leveraged trust replaces a lot of mortgage with a small slice of proceeds, as replacing a big mortgage payoff shows.
Compare the cost of that cash with the alternatives before deciding: taking boot at the sale, or refinancing a property you own outright, covered in cash out DST versus taking boot and pulling cash out after a 1031.
Where the cash comes from also decides when it is taxed
Commissioner v. Tufts states the rule: 'Because of this obligation, the loan proceeds do not qualify as income to the taxpayer.' The tax arrives later, because the loan is part of what you realize when the property sells.
That is the subject of is the cash from a zero cash flow DST refinance taxable.
Related questions
Is the 80% to 90% guaranteed?
No. It is how our cash out DST page describes the structure; the actual amount depends on the offering's loan terms and the property at refinance.
Can I take the cash at the exchange closing?
No. Cash at closing would be boot. The cash in this structure comes from a refinance after the exchange, at a point the offering defines.
Do I receive income while waiting for the refinance?
No. All operating income goes to the loan, and investors do not receive current distributions.
Am I personally liable for the bigger loan?
No. Our pages describe the financing as non-recourse, so only your invested capital is at risk.
What do I get when the property sells?
Whatever remains after the loan is repaid, which in a highly leveraged trust may be a small share of the sale price.
Sources
Checked against these publications on September 30, 2026. Rules and figures change; confirm the current version with your CPA or attorney before you act. This page is general information, not tax or legal advice.