Capital gains tax can be deferred or reduced if a seller utilizes the proper sales method and/or deferral technique. There are many sales techniques and methods out there, each of which have their benefits and drawbacks. See some ways to defer and/or reduce capital gains tax below.
Deferred Sales Trust - Allows the seller of property to defer capital gains tax due at the time of sale over a period of time.
1031 exchange - Defer tax by exchanging for "like kind" property. Pay capital gains when it is realized.
Structured sale annuity (aka Ensured Installment Sale) - Defer and reduce capital gains tax while gaining safety and a stream of guaranteed income.
Charitable trust - Defer and reduce capital gains by giving equity to a charity.
Installment Sale - Defer capital gains by taking payments from a buyer over a period of years. No protection from buyer default.
Self Directed Installment Sale (SDIS) - Allows for the deferral of capital gains taxes while removing the risks from buyer default under a traditional installment sale.[2]
(historical) Private annuity trust - No longer a valid tax deferral tool.