June 6, 2013
IRS Rules That Fideicomiso's Holding Title to Property in Mexico in most situations are not Foreign Trusts
After 10 years of controversy and refusals to make a ruling, the IRS has finally ruled that most Fideicomiso's in Mexico are not foreign trusts and are not required to file Forms 3520 and 3520A.
Revenue Ruling 2013-14 describes a typical fideicomiso or Mexican Land Trust (MLT) and concludes that the arrangement is not a trust within the meaning of § 301.7704-4(a) You should read this ruling carefully since it only applies to the situations described therein. If you have Fideicomiso that falls outside the the ones described in this ruling, you may still be a foreign trust under US tax law and be required to file special forms.
Revenue Ruling 2013-14 will be in 2013-26, dated.