Internal Revenue Service
Revenue Ruling

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 Rev. Rul. 63-16

1963-1 C.B. 350

Sec. 6903

IRS Headnote

A trustee acting for another person under an `Illinois land trust' is held to be acting for such person in a fiduciary capacity and is, therefore, required to file a notice of fiduciary relationship under section 6903 of the Internal Revenue Code of 1954.

Full Text

Rev. Rul. 63-16

Advice has been requested as to the applicability of section 6903 of the Internal Revenue Code of 1954 to `Illinois land trusts.'

Under an `Illinois land trust,' legal and equitable title to real estate is transferred to a trustee. The beneficiary of the trust is entitled to almost all other incidents of ownership although his beneficial interest is deemed to be an interest in the nature of personal property.

Section 6903(b) of the Code provides that a notice of fiduciary relationship shall be given in accordance with prescribed regulations.

Section 301.6903-1(a) and (b) of the Regulations on Procedure and Administration require, in part, every person acting in a fiduciary capacity for another to give written notice thereof to the District Director for the district where the return of the person for whom the fiduciary is acting is required to be filed. In addition to other information, the notice must state the name and address of the person for whom the fiduciary is acting.

Section 7701(a)(6) of the Code defines the term `fiduciary' to include a trustee or any person acting in any fiduciary capacity for any person.

A trustee acting for another person under an `Illinois land trust' is acting for such person in the capacity of a fiduciary. Accordingly, the trustee is required to file a notice of fiduciary relationship under section 6903 of the Code.

The notice referred to above is required to be filed on Form 56, Notice to the District Director of Internal Revenue of Fiduciary Relationship, or other appropriate form, which includes a provision stating, `This notice is given with respect to the liabilities of _ _ under the Internal Revenue Code. Specific liabilities of which I (we) have knowledge are as follows: _ _ .'

A separate Form 56 or other appropriate form should be executed for each beneficiary under an `Illinois land trust,' whether such beneficiary is designated in the original instruments creating the trust or secures his interest by assignment from another. The beneficiary's name should appear on the form in the space following the words `liabilities of.' If the trustee has no knowledge of any specific liabilities, he should so state. A true copy of the deed in trust and trust agreement creating the Illinois land trust should be attached to the Form 56 (or other appropriate form).

In order to effectuate this ruling, Form 56 (or other appropriate form) should be filed in connection with each Illinois land trust in existence on and after January 1, 1963, except that the trustees of such trusts may have until August 11, 1963, to file the appropriate forms for all trusts in existence on or before February 11, 1963. Otherwise, the appropriate forms should be filed within thirty days following the date that the deed in trust was executed and delivered to the trustee, or the date when an assignment of beneficial interest has come to the knowledge of the trustee.