A Florida Land Trust is an agreement where someone else agrees to hold your property in his name for you, but leaves you in complete control of the property. A Land Trust is a form of Revocable Living Trust, which is specific to real estate. It provides a method of holding a title to real property in the name of the trustee for the benefit of one or more parties known as beneficiaries.
What are the benefits of a Florida land trust?
Privacy – By using a land trust no one knows you own a property. No one knows how much money you have in the bank or what stocks or bonds you own; why should all your real property be public record? There is no public record of the properties you own in land trusts. This means creditors, ex-spouses, tax authorities, lawyers and others do not know you own the property and will be less likely to be able seize it.
Keep price secret – By using a land trust you can keep your purchase price of the property and your sales price secret.
Avoiding liens – Liens, judgments and other claims against you or your partners do not touch the property. This means you can buy and sell properties, even if you have judgments or liens against you.
Avoiding probate – When you die you can have your trust property instantly go to whomever you name. No probate, no delay, no lawyers.
Avoiding lawsuits – Lawyers are eager to sue people who own lots of property. If it doesn’t look like you own much property it is less likely someone will sue you. Or if they do sue you there is a better chance they will accept settlement with your insurance company than go after property they don’t know you own.
Who owns the Land Trust?
A Land Trust is owned by the beneficiaries. The owner of record however is the trustee who has a fiduciary responsibility which is to act only as directed by the beneficiaries. This meaning the person who is legally appointed and authorized to hold assets in a trust for another person.
How do I set up a land trust?
It is simple; just call or offices and we will email you the application form. Once you complete the form you can email or fax it back to us and we will prepare the necessary paperwork for your review and execution. We will prepare both a Warranty Deed to Trustee as well as the Declaration and Land Trust Agreement
Can I title more than one property in one Land Trust?
This is possible, however we recommend against doing this is one of the advantages of putting your property in trust is to limit your liability. By placing multiple properties into the same Land Trust, you risk loss on multiple properties when one property is involved in a law suit. Additionally, the ease of transferring single properties out of a multiple property trust can be more difficult.
Not sure you’re ready to go?
We offer a 30-minute consulting session to help you decide if using a land trust is for you. We will share both our knowledge and experience to help you understand how to use a land trust. This consultation is on the workings of a land trust. Should you have questions of a legal nature or suitability of a land trust to your specific needs we encourage you to consult with an attorney.
What is the Beneficiary?
This is the person/entity who receives the economic benefit from the property.
What is the Trustee?
This is the person/entity in whose name the property is titled. They receive instructions in writing from either all beneficiaries jointly or from a Director named in the trust.
What is the Successor Beneficiary?
This is the person who would replace Beneficiary in the trust in the event of beneficiary’s death. This person has no rights or guarantees and may be changed at any time unless an irrevocable instruction to the trustee is given in advance.
How can I hold the beneficial interest?
Single – 100% interest; Various individuals having percentage interest, totaling 100%; as Trustee of a Living Trust; Joint Tenants; Multiple Owners;Tenants by the Entirety; Corporation; Partnership; LLC (Limited Liability Company).
How can I keep my name off of the public tax bill records?
To keep your ownership private, you may wish to have your tax bills sent to the land trust. Contact your county assessor to obtain their local form to change the tax assesse (taxpayer) and have future tax bills to our office.
How will a land trust affect my taxes?
A land trust has absolutely no affect on taxes. It has no taxpayer identification number. All finances of the property are passed through to the owners.
Does the IRS need to know about my land trust?
Yes, IRS Form 56 must be filed with the IRS when a property is transferred in or out of a land trust.
Can I be my own trustee?
It is not good to have the same person as both the beneficiary and the trustee or the trust may “merge” which is a legal word meaning it no longer exists. (Even though the doctrine of merger should not apply to a land trust one court in Florida said that it did in one case and this could cause a problem.)
Can I set up my own corporation to be trustee?
Yes, any corporation can serve as a land trust trustee, but keep in mind that anyone can look up your corporation on the Internet and find out who are your registered agent, officers, and directors.
Who would be the best trustee?
The best trustee would be a person or company unrelated to you whom you can trust. It can be an attorney, bank, trust company or trusted friend.
Should I put my homestead in a land trust?
Opinions on this differ. Since some property appraisers started listing homesteaded property owners on the tax rolls, the secrecy is lost. The main benefit today is that it will avoid probate. However, if someone gets a judgment against you, you must take your property out of the land trust to protect it.
Can I still get the homestead exemption with a land trust?
Yes, if you set up the trust correctly.
Latest posts by Common Wealth Land Trust (see all)
- Order A Land Trust - November 7, 2018
- Partition Protection: What is it? Why do I Need it? - November 7, 2018
- Disregarded Not Disrespected: Land Trusts and Taxation - November 7, 2018