– Blog by Morgan Chambers
What is a farmland trust?
In understanding what a farmland trust is, it is best to first comprehend what a trust means. In the eyes of the law, a trust is an accord whereby property is held by one party for the benefit of another party. The trust is initiated by the owner, who transfers property to a trustee. The trustee holds that property for the beneficiaries of the trust.
The farmland trust is a real estate title-holding vehicle and a malleable legal entity created to provide privacy of ownership and assist in the avoidance of probate. Furthermore, land trusts offer protection against judgments and liens and ease of transfer of beneficial interest. Also, use of beneficial interest as collateral, prevention of property partition, and agricultural land-use protection. Those looking to find farmland for sale should consider a farmland trust.
Sometimes, land trusts are cited as Illinois Land Trusts. In the early 19th century,
the idea of a land trust first came about in the city of Chicago. The land trust works in conjunction with landowners to conserve and preserve land. These are typically nonprofits, also known as 501(c)(3)s.
A farmland trust offers a way to secure privacy of ownership and to avoid probate and can also assist in protecting against judgments and liens. They avert land partitions and provide for ease of estate planning and real estate title transfer
What benefits do farmland trusts provide?
Farmland trusts can be quite large or just small enough to fit the purpose. They work with landowners who may need protection from developers and other predatory authorities. A land trust is a legal and private contract sanctioning a property title as it is transferred from the owner to a trustee. New farmland owners are advised to find farmland for sale that is under the legal provisions of a farmland trust.
Some of the benefits of a farmland Trust:
- Keep ownership of one or more properties private
- Easily transfer ownership of one or more properties to someone else
- Avoid probate on one or more properties you own
- Enable many owners of one or more pieces of property
- As the owner, you keep the tax advantage
An intact land trust means that the grantor can continue to receive benefits from the property and that said benefits may include the right to build, sell, rent, or transfer the property to their heirs.
Who needs a farmland trust and how do they acquire one?
Anyone in the process of buying a farm will greatly benefit from a land trust by getting access to affordable farmland and by buying the easement to lower the cost of the property. Land trusts also assist in purchasing and reselling farmland at its agricultural value and also buying farmland that may be leased at a later time.
Acquiring a farmland trust, you must first decide on a name to use for your properties. Then, select a trusted friend or family member as trustee and see a land trust attorney to draw up a contract that states the rights of both parties being you and your farmland trust.