How Do Land Trusts Work in South Carolina?

When it comes to managing and protecting certain assets, a land trust can be a useful tool. There are several forms of trusts that can be utilized in a comprehensive estate plan, all of which can help you control assets in a variety of ways. With a land trust, you have the power to manage and control assets that relate to property ownership. You might find yourself asking: “How do land trusts work in South Carolina?” The team at Mack & Mack Attorneys can answer that question.

For over 85 years, Mack & Mack Attorneys has been assisting clients in a wide range of real estate and estate planning scenarios. In estate planning, a land trust can be used to transfer the title of a property to a trusted and appointed individual, known as the trustee, for legal reasons. However, the original owner of that property does not lose their claim on ownership. Land trusts can serve to ensure privacy and control and can offer comprehensive asset protection.

What Is a Land Trust in South Carolina?

In simple terms, a land trust is a legal tool that is established to safeguard real estate and other related assets. These assets can include the physical real estate property itself, such as homes, plots of land, commercial or rental properties, mortgages, notes, or air rights. These trusts are usually established to be revocable, meaning the individual who creates the land trust has the ability to change, modify, or even terminate the trust should they so choose.

The main purposes a land trust can serve are to provide property owners with both privacy and anonymity, offer liability protection, and help avoid probate court when the original holder of the property passes. Creating a land trust can be extremely beneficial for investors of real estate who want to shield their assets from possible legal liabilities and keep their identity confidential during times of property negotiation.

Because a land trust is typically revocable, the grantor maintains a certain degree of flexibility over the assets held within the trust and may take certain actions, such as:

• Making modifications to the provisions of the trust as their personal needs or life circumstances change
• Modify the trust as new financial or personal situations arise
• Assign new beneficiaries to the trust or remove others
• Edit the instructions for distribution
• Make updates or changes to the terms and conditions of the land trust

It can be wise to consult with legal counsel about what form of land trust suits your unique needs, your loved ones’ needs, and your real estate assets.

The Benefits of a South Carolina Land Trust

There are several benefits to setting up a land trust in the state of South Carolina. These can include the following:

• Land Trusts May Help Reduce Tax Burdens: Though the establishment of a land trust will not help you completely avoid paying taxes, it can allow you to receive certain tax benefits that help bring down the price of your overall tax bill.
• Land Trusts Can Allow Anonymity: When you place property into a land trust, the name associated with that land will be that of your appointed trustee, not you. This can allow you to protect yourself from solicitations from salespeople or other real estate investors.
• Land Trusts Can Protect Against Liability: When you purchase a piece of property, that sale is considered public record, as is the price you paid for it. In today’s real estate world, it can be common for competitors or other opportunities to scroll through records, make an estimate on your net worth, and try to sue you. Even a claim with no grounds can freeze up your real estate holdings and prevent you from taking certain actions.
• Land Trusts Can Keep Sale Prices Private: Like keeping your name from public records, creating a land trust can also keep financial information out of the public eye. This kind of anonymity can offer you a form of leverage, especially in cases where a real estate investor is working with commercial real estate of a high profile. These negotiations can be extremely challenging, and a public record of your financial worth can be a liability.
• Land Trusts Can Help Easily Transfer Property: When you place real estate holdings into a land trust, it can make it easier to transfer this property into other hands at a later date as long as the beneficiary of the trust and the individual who created the trust is still alive.

FAQs

Q: What Are the Disadvantages of a Land Trust?

A: While a land trust might be the perfect fit for some individuals, others can find that these estate planning tools come with certain disadvantages. These disadvantages can include the fact that it can be tough to get a mortgage, the setup fees involved in a land trust can be costly, and, if the establishment is not done right, you may lose out on your ownership of the property once it goes into a trust.

Q: What Are the Costs Involved in Establishing a Land Trust?

A: There can be many costs involved in establishing a land trust and various factors that can affect the amount of these costs. These factors include the complexity of the creation of the trust overall, how long it takes to create the trust, and the experience of the attorney you work with to ensure the land trust is established in a legal and valid way.

Q: How Do I Transfer Property to a Trust in South Carolina?

A: In order to fund or transfer property into a land trust in South Carolina, you must transfer the official property deed to the trust. Mistakes can be made at this stage, which is why it is so important that you only establish a land trust with the assistance of a professional and experienced attorney.

Q: What Is the Difference Between a Land Trust and a Living Trust?

A: There are several key differences between the establishment of a land trust and that of a living trust. These include the assets held within these trusts, as land trusts only hold real estate properties, while living trusts can include other types of assets, such as bank accounts or investments. Land trusts also tend to offer more flexibility for the grantor.

Speak with Trusted Legal Counsel Today

If you are wondering if a land trust might suit the needs of yourself and the assets you own, talking to a legal professional, such as the estate planning lawyers at Mack & Mack Attorneys, can be a wise choice. Contact our offices today to schedule a consultation and learn more about the establishment of land trusts.