There are a number of good reasons why an individual would want to pursue a land trust. A land trust involves the transfer of a property’s title over to a trustee. The trustee is usually referred to as a settlor. In a land trust arrangement, the beneficiary has ultimate control over the relationship and can revoke the trust at any time. A few reasons why a land trust might be desirable to someone:
- You can hide your identity as the legal owner of a property from third parties.
- You can change the beneficiary of a land trust without recording this publically.
- You can avoid probate with a land trust in the event of your passing.
- You can establish and define a clear legal division between multiple owners.
- You retain a tax advantage for homeowners and senior citizens.
What do I need for Proper Land Trust Record Keeping?
Essentially, there are only two documents that are required to create a land trust. Those are:
- A Deed to Trustee
- A Trust Agreement
The TA (trust agreement) is incredibly important. It is recommended that you keep additional copies of it handy. You will need the trust agreement in the event that you want to either change the trust or sell a property from the trust. Make sure that you have both hard copies and digital copies that you can easily access.
For those that have misplaced their TA, a new copy can be drafted by the trustee. This is yet another reason why land trusts are superior to wills. If a will cannot be produced when it is required, it is presumed to have been destroyed or revoked by the individual who drafted it. For those who have lost their trust agreement, there is no such presumption.
The trustee, however, will need to indicate that the new TA is an amended and restated copy. They do this by indicating such at the top of page one on the restated TA. At the top of the document simply write:
“Amended and Restated Trust Agreement”
In the body of the TA, it’s good practice to indicate somewhere that the original trust agreement was lost or could not be found and needed to be redrafted by the trustee.
For obvious reasons, it’s better to have not lost the original trust agreement in the first place. Nonetheless, it’s not exactly the end of the world when that happens. Trusts are meant to be versatile and save folks some of the inconveniences of dealing with wills. So there are methods in place for managing such issues if they occur.