A land trust is a special way of holding title to real estate that is sometimes used in Florida. While they can serve certain purposes, they are not a one-size-fits-all estate planning solution. Understanding how land trusts work—and when they make sense—can help you decide whether this tool is right for your situation.
What Is a Land Trust?
A land trust is an agreement where a trustee holds legal title to real estate, but the true ownership (called the “beneficial interest”) remains with one or more beneficiaries. In most cases, the trustee follows the instructions of the beneficiary, and the trust can be revoked or changed at any time.
Unlike a revocable living trust, which is designed to cover your overall estate and avoid probate, a land trust is limited to a specific property.
Why People Use Land Trusts
Land trusts are most commonly used for:
- Privacy – Only the trustee’s name appears in the public records, which can keep an owner’s name off the deed.
- Ease of Transfer – The beneficial interest in the trust can be reassigned without recording a new deed.
- Real Estate Investment – Investors may use land trusts to hold multiple properties or streamline sales and purchases.
- Partition Protection – Co-owners can agree that the property cannot be split up without consent.
Limits of a Land Trust in Florida
While land trusts can sound appealing, there are important limits to keep in mind:
- No Asset Protection – Creditors can still reach the beneficiary’s interest.
- Homestead Complications – Florida’s homestead laws make land trusts less useful for primary residences.
- Not a Probate Shortcut by Themselves – Unless combined with broader estate planning, a land trust alone will not keep property out of probate.
- Extra Complexity – Setting up and managing a land trust requires more documents and oversight than many families need.
When a Land Trust Might Make Sense
For most Florida families, tools such as a revocable living trust or an enhanced life estate deed (Lady Bird deed) are more effective for avoiding probate and protecting loved ones. However, a land trust may be appropriate if:
- You own investment property and want privacy or flexibility.
- You are co-owning property with others and want clear rules against partition.
- You are actively buying and selling real estate and want smoother transfers.
Conclusion
Land trusts are a niche tool that can be helpful in certain real estate or investment situations. For general estate planning in Florida, other options usually provide better results with less complexity.
If you have questions about whether a land trust makes sense for you—or whether another approach would better meet your needs—contact Bart Scovill, PLC for a consultation. https://scovills.com/?p=3161
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