Today we’re talking about estate planning and setting up a Tampa real estate trust. More specifically, we’re talking about the Florida land trust.
Tampa Real Estate Trust: What is a Florida Land Trust?
Estate planning is an important part of setting up your estate so that everything is taken care of upon your death. It keeps things simple for those who you are leaving behind by tracking your assets, by establishing your beneficiaries, and making sure that all of the loose ends are tied up so that your heirs aren’t left with a pile of complicated and unorganized paperwork.
Living trusts are also important because if you own multiple properties in multiple states and don’t place them in a trust, after your death, your loved ones would have to open probate in every state where you owned property. This can get complicated if you are a real estate investor!
So What is a Real Estate Trust?
A real estate trust is a vehicle by which you can own real estate without that real estate being considered as part of your estate. In the state of Florida we can do this through a Florida Land Trust.
A Florida Land Trust works in the following way:
Bob wants to buy a farm, but upon his death, he does not want that farm to be considered a part of his estate assets. Instead, he wants that farm to be given to his son.
So, Bob sets up a Florida Land Trust. This trust puts the farm in the name of the trust and that trust is managed by a trustee. This way, on paper, Bob doesn’t own the farm, the trust does. So, when Bob dies, the farm is not included in the assets that are divided among Bob’s heirs. Instead, the trust property is passed directly on to Bob’s son as determined when Bob set up the trust. The benefit of this is that because it was incorporated into a trust, Bob’s farm cannot be sold to pay off creditors and it cannot be sold with the proceeds divided up between his beneficiaries. Bob’s son is guaranteed to get the farm.
Important Documents in a Land Trust
There are two important documents that are required when it comes to a land trust – the trust agreement and the deed in trust. The deed in trust is what gives the trust ownership of the property. The trust agreement proves that the trustee has the power to act in the role of trustee.
A Florida Land Trust Is Almost Always a Revocable Trust
There are two types of trust – revocable and irrevocable. A revocable trust is one that you can amend at any point during your lifetime. An irrevocable trust is one that cannot be changed/amended/edited without the beneficiaries of the estate approving of the changes.
In Florida, revocable trusts must pay income tax if $600 or more is earned during the year. This is taxed on the trust and are not individual who set up the trust.
Do You Need a Land Trust?
Whether or not you will need a land trust is going to depend on a lot of factors. No one can tell you whether a land trust is right or wrong for you, but if you could use some guidance based on your specific personal information, the best thing you can do is consult an attorney.
Can an Estate Planning Attorney Help me to Set Up a Land Trust?
Yes. Your estate planning attorney will help you to go through your estate plans and decide what type of institutions, if any, are right for your estate. You don’t have to follow your attorney’s advice, but it’s always wise to at least entertain the ideas that your attorney presents.
Why listen to your attorney? Because they likely have years of practice in real estate law and the probate process and as your attorney, they want to do what is best for you and your estate.
Can I Be My Own Trustee?
If you set up a trust, is it possible to be your own trustee? Yes. You can serve as your own trustee so long as you are mentally fit to handle your own financial affairs. You can also share the responsibility of being a trustee with your husband or wife.
Do I Have to Register my Living Trust with the Court?
No. A living trust does not have to be registered with the court. In fact, your living trust is a private document that is not published or made available for others to view.
It is important to note here that while your living trust is not filed with the court, your deed to any property is freely accessible to everyone as it is a matter of public record.
Can My Attorney Serve As My Trustee?
Yes. Your attorney may serve as your trustee. In fact, you can appoint a wide range of individuals to serve as your trustee, however, you must always be sure that this person is someone who you trust to manage your financial affairs, someone who is responsible, and someone who has some understanding of how a trust works and what a trustee is expected to do.
Interested in Setting up a Tampa Real Estate Trust?
If you’re interested in planning your estate and would like to set up a Tampa real estate trust, Weidner Law can help. Set up an appointment today for a consultation with Attorney Weidner by calling 727-954-8752!