UP

Florida Land Trusts Keep Prying Eyes Away

Written by 

A Florida Land Trust can allow the true beneficiary of a property to remain private, but this is only the start of a Land Trust's benefits. A land trust can

also allow a property to avoid probate in case of the death of the beneficiary, which can be an expensive and time consuming process The Florida Land Trust is codified in Florida Statute 689.071, and sets out in statute what has been done as case law as an Illinois Type Land Trust for over 100 years.

The main components of a Land Trust are as follows:

 

  • A Beneficiary - is an entity (person, corporation, other trust, etc.) that has a vested or contingent interest, regardless of how small or minimal such interest may be.

  • A Trustee - means the person or entity designated in a trust instrument to hold legal and equitable title to property of a land trust. This is the name visible to the public. The trustee can be a beneficiary.

  • Holder of the power of direction (optional) - this entity is the one that directs the Trustee what to do with the property.

 

Now how do you use these components work?

The land trust itself is a written agreement, that spells out the duties and interests of the parties.

A typical setup could have your children as beneficiaries, a law firm named as the Trustee and you, hold the power of direction. Property would be purchased and title would be held as "Kirschbaum Law Office, Trustee of the ABC123 Land Trust dated October 1, 2012".

If this were a commercial property, rents could be paid to the Law Firm or to a 3rd party and then disbursed to the beneficiaries. Anyone searching the public record would not be able to determine that you or your children are receiving the benefits of the property.

If down the road you determine you no longer wish your children to receive the benefits of the property, the land trust can be set up in such a way, that you can change the beneficiary to yourself or anyone else you choose.

You could sell the property, allow it to remain in the trust and give the new owner the power of direction and the ability to change the beneficiary. There would be no mention of the transfer on the property appraiser's website or anything recorded in the Official Records (you are still obligated to self report this transfer and pay the appropriate deed tax and any Federal Income Tax due).

In one of the Trusts our Firm manages someone tried to determine who was really flipping a group of lots in Port Charlotte, but they couldn't get past the name of our Company. Here's an article reporting on the profits earned in one of the Land Trusts our office set up? Would you want your name out there as earning these profits or would you like to keep your business private?

Request Florida Land Trust Package