Can a Land Trust Help Me Avoid Probate in Illinois?

 Posted on September 10,2024 in Estate Planning

There are many factors to consider during the estate planning process. For real estate owners, these may include estate tax exemptions, naming beneficiaries, and multi-generational planning. One of the most common questions estate owners have is how to avoid probate, a grueling legal process for transferring assets after they pass away.

That is why many estate planners who own property choose to place it in a land trust. A land trust, which this article will discuss, has several benefits that make it an attractive legal instrument. We will also explore how it can avoid probate. To understand if a land trust is right for you or for help setting up a land trust, contact an experienced Illinois estate planning attorney.

What Is a Land Trust?

As its name suggests, a land trust is specifically designed for real estate. It is a legal entity that assumes ownership of the property that previously belonged to the grantor.

A land trust involves three parties:

• The grantor, who transferred the property into the trust
• The trustee, who manages the trust
• The beneficiary, who the grantor names as the person who will benefit from the trust

Since it is a revocable trust, changes can be made to the entity, or it can be revoked entirely. While it is in the land trust, the property can still be accessed. For example, if a rental property is placed in a land trust, the trustee can continue to maintain the property and collect rent.

What Is the Purpose of a Land Trust?

One of the main reasons real estate owners set up land trusts is because they offer privacy. Normally, when you purchase property, your name is on the title and, therefore, available to the public. When it is in a land trust, however, you can choose not to have your name attached to the property. This is why high-profile people like celebrities and politicians often choose to set up land trusts.

Another reason land trusts are popular is because they help avoid probate.

How Do Land Trusts Avoid Probate?

Probate is a process in which a court executes someone’s will after he or she is deceased and distributes his or her assets. It is an intensive and often drawn-out procedure that can be frustrating to the decedent’s heirs. There is a lot of paperwork and accounting involved as the court reviews all the assets and liabilities. The property remains inaccessible while the court invites creditors to claim their debts from the assets and then distributes whatever is left to the beneficiaries.

Placing that property in a land trust, however, keeps it separate because it is no longer owned by the grantor. This keeps the land out of probate and makes it accessible to the beneficiaries without first having to pass through the arduous probate process. It also can offer certain protections from liability, though that is a more in-depth discussion to be had with your attorney.

Contact a Roseland, IL Land Trust Attorney

Land trusts have many benefits, but they are complex legal tools that are best created with the help of an Englewood, IL land trust lawyer. At The Sherrod Law Firm, Ltd., we fully understand the legal nuances of land trusts and we are ready to create one tailored to your needs. Schedule a free consultation with an experienced attorney by calling 312-321-6910 today.