It’s amazing to still see many investors who aren’t using land trusts at all, along with investors using them improperly. On top of this, there’s a boatload of investors who are victims getting abused with every property purchased. Somewhere out there, somebody knew somebody who had a friend who did this or that and the investor becomes a victim. Although hard to believe, some investors go to their local veteran attorney and amazingly have been told they’ve never heard of a land trust.
What Is A Land Trust?
A Land Trust is a simple fill-in-the-blank document to “hide” or keep the real owners name off public records. It’s nothing more than 6 pieces of paper detailing an agreement between the “trustee” and the “beneficiary”. Plain and simple, it’s an “instrument” (piece of paper) to hide or shield from public view the “beneficial interest” (you or your entity). A land trust does not have a Tax ID number. The “beneficial interest” has the tax id number. The Land Trust name or agreement has absolutely nothing to do with your taxes. The beneficiary of the land trust agreement reports all of the taxable events involving the property. Many times bankers and attorneys get land trusts confused with perhaps estate planning trusts and insist or demand each land trust must have it’s own tax id, it’s own bank account, and must file it’s own tax return. Wrong. They want to sell you more stuff. That is NOT the right kind of trust. This is the simple Land Trust started in Illinois with the intent to simply hide the real owners from public record.
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