Did Florida-resident grantors or an out-of-state trustee owe Florida intangible tax on trusts whose assets lacked Florida situs?

Subject

Taxable Situs - Property Subject to Tax - Trusts -Beneficial Interest

Plain-English summary

Neither the out-of-state trustee nor the Florida-resident grantors had to file a Florida intangible-tax return for the trusts. The trustee lived outside Florida and had no Florida office, the trust assets had no Florida situs, and the grantors did not hold a beneficial interest as defined by the cited statute.

The Department explained that a trustee was primarily responsible only for a trust with Florida taxable situs, while a beneficiary was taxed only on a taxable beneficial interest.

What this means for you

Florida residence of the grantors alone did not create liability on these facts. The result depended on both the location of the trustee and assets and the absence of a statutory beneficial interest held by the grantors.

Common questions

Q: Were the trusts subject to Florida intangible tax? No, under the stated situs and ownership facts.

Q: Did the nonresident trustee have a filing duty? No. The trustee and trust assets were outside Florida, and the trustee had no Florida office.

Q: Did the grantors' Florida residence create a filing duty? No. The ruling said they lacked the defined beneficial interest in the trusts.

Citations and references

• Fla. Stat. §§ 199.023(7), 199.052(5), (6) — beneficial interests and trust liability
• Fla. Stat. ch. 199 — intangible personal property tax
• Fla. Stat. § 213.22 — Technical Assistance Advisements

Source

• Landing page: Florida Tax Law Library
• Advisement: TAA 93C2-009

Original ruling text

Mar 22, 1993

Re: Technical Assistance Advisement No. 93(C)2-009
Intangible Personal Property Tax - Chapter 199, F.S.
Taxable Situs - Property Subject to Tax - Trusts Beneficial Interest
XXX (Trusts)
XXX (Trustee)
XXX (Grantors)

Dear :

This is in response to your recent request for a technical
assistance advisement concerning the taxability of Trusts.

Facts

The Grantors of the Trusts are residents of the State of
Florida. The Trustee of the Trusts is an out-of-state resident,
and the situs of the Trusts' assets is out-of-state. The
Trustee has no office in this state. The Grantors do not have a
"beneficial interest" in the Trusts, as defined in s. 199.023
(7), F.S.

Requested Advisement

1. The Trustee of the Trusts has no liability for the
   Florida intangible tax if the Trustee is not a
   resident of Florida and the Trust's assets do not have
   Florida situs; and
2. The Grantors of the Trusts have no liability for the
   Florida intangible tax with respect to intangible
   assets owned by such Trusts.

Discussion and Law

Section 199.052 (5) and (6), F.S., states that the trustee
of a Florida situs trust is primarily responsible for the
payment of the intangible tax on a trust which has a taxable

situs in Florida.

A beneficiary with a taxable beneficial interest in a
trust, as described in s. 199.023(7), F.S., is subject to the
Florida intangible tax.

Conclusion

Based on the statutory provisions and the information in
your letter, the Trusts are not subject to the Florida
intangible personal property tax. Neither the Trustee nor the
Grantors would be liable for filing a Florida intangible tax
return.

This response constitutes a Technical Assistance Advisement
under s. 213.22, F.S., which is binding on the Department only
under the facts and circumstances described in the request for
this advice as specified in s. 213.22, F.S. Our response is
predicated on those facts and the specific situation summarized
above. You are advised that subsequent statutory or
administrative rule changes or judicial interpretations of the
statutes or rules upon which this advice is based may subject
similar future transactions to a different treatment than
expressed in this response.

You are further advised that this response and your request
are public records under Chapter 119, F.S., which are subject to
disclosure to the public under the conditions of s. 213.22, F.S.
Your name, address, and any other details which might lead to
identification of the taxpayer must be deleted by the Department
before disclosure. In an effort to protect the confidentiality
of such information, we request you notify the undersigned in
writing within 15 days of any deletions you wish made to the
request or the response.

Sincerely,

Nadine C. Posey
Technical Assistant
Technical Assistance

NCP/mh