Mexican Land Trusts are not a trusts for US tax purposes

fideicomisoI came across a very interesting article today by Grand Thornton LLP regarding fideicomiso (or Mexican Land Trust). As I have posted on my “How to own property in Mexico” page the foreign nationals can own property within a restricted coastal zone by opening a Mexican Land Trust with the Bank. The IRS issued a guidance (Rev. Rul. 2013-14)  providing that the Land Trusts in Mexico are not trusts for US tax purposes .This means no reporting is required regarding the Mexican Land Trusts (such as Forms 3520 and 3520-A). It goes on to explain that the Bank does not pay any property related expenses and therefore is not treated as a trust.