Benefits of a Florida Land Trust

Florida Land Trust Explained

The beneficiaries of the trust direct the trustee on how to maintain the property. The trust also allows the beneficiaries to collect rent without holding legal title to the property. Land trusts can be formed to benefit either an individual or an entity. The Florida Land Trust Act was adopted by the Florida legislature in 2006.
Benefits of a Florida Land Trust
Forming a land trust within the State of Florida has many benefits. A few of the most common uses are listed below.

• Land trusts allow multiple properties to be managed by a single trustee for the benefit of separate owners/beneficiaries.
• A land trust may provide security as an interest within a land trust cannot be split or sold.
• Should a judgment arise against a beneficiary, it would be unlikely to affect the title of the trust.
• Conversely, should a judgment arise against the land trust, it should not affect the beneficiaries.
• If the beneficiaries of the land trust qualify for Florida’s Homestead tax exemption, the land trust may qualify as well.
• A properly drafted land trust completed by an experienced attorney may avoid deadlocks among the beneficiaries.

Other information you should know about Land Trusts

• Land trusts remain private at the discretion of the parties, unless a court orders the disclosure, as land trusts do not need to be recorded in the State of Florida.
• Creditors, ex-spouses, tax collectors, and attorneys are generally unable to determine whether an individual owns an interest in a land trust, and they are therefore less likely to be able to seize such property.
• When acquiring property through a land trust, the identity of the buyer(s) may be withheld, in turn potentially providing greater leverage in a transaction.
• The purchase price of a property may also be withheld from public purview.
• Property held in a land trust is generally not subject to probate. Furthermore, death or incapacity of a beneficiary does not result in the trust’s termination.

How to set up a Florida Land Trust

• Land Trusts must be drafted utilizing special language found in the relevant Florida Statutes.
• Once established, a trustee should file an IRS Form 56 or similar documentation, as required.