Posted by Bill Gatten on March 11, 1999 at 12:53:20:
Just remember that the IRS requirement (guideline) dictates that no beneficiary in a (Illinois-type) land trust may hold less than a 10% interest (serves to limit participants to ten, in order to comply with, and not to be confused with, Security and Eschange Issues and regultions).
You’re right. Any perdentage of beneficiary interest can be granted separate from “voting rights”; however, if you want to avoid property tax increases (in most, if not all, counties), you need to assure than no more than 50% of the voting rights (Power of Direction) is relinquished by the owner of record when title is conveyed to the [living] trust (Rev. and TC Regs).
As far as income tax benefits are concerned, its a matter of who makes the payment: He who pays, deducts–assuming Qualified Residential or Income Property requirements under IRC Secs 163, 167 etc. are met.
As concerns the verbiage you refer to, its from the Trust Agreement itself, and is pretty much boiler- plate, designed to clearly separate Realty interest from Personalty for the beneficiaries: a major benefit of land trusts in general. The reference to “any other trust property” is meant to pertain to other properties previously or subsequently held by the same land trust.