I am constantly challenged as to whether or not a Land Trust has to file a tax return. Attorneys, accountants and other professionals try to tell me (and their clients) that if you put your property into a Land Trust the Trust will have to file a return with the IRS. The problem is that most professionals are used to other kinds of trusts (that do have to file a tax return) and not the Illinois Type Land Trust.

This is not to say that all Land Trusts ARE Illinois Land Trusts, just that they are like an Illinois Land Trust. Nonetheless, no matter in which state you form your Land Trust, a Federal tax return is NOT required.

And for you skeptics out there, here is the section of the IRS code that deals with this subject: Revenue Ruling 92-105 and IRS Code Section 677.

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