What is Allodial Title?

Posted by admin on September 19, 2013

When a property is held in allodium, it means that the owner has full and complete rights to it. There is no landlord, no building permits, no taxes, and no applicable by-laws. The owner has absolute title over the property, and the property is owned free and clear from everyone- including banks and all levels of government- and ownership can only be lost when the person dies and leaves it to more than one heir.

Before you get too excited and start searching for tax-free, affordable investment property, know that allodial titles don’t exist in North America anymore: they were abolished after the Great Depression. However, two states- Nevada and Texas- recently dabbled in limited allodial title policies that were designed to protect owners from the tax increases that often result from unincorporated land becoming part of a municipality. Unfortunately, the Nevada allodial title provisions were abolished in 2005, and there are questions as to whether Texas ever went through with theirs as a result of Nevada’s fate.

One form of allodial land that actually does exist in the United States today belongs to Native Americans, and is the reason they aren’t required to pay taxes on their property (this includes businesses that operate on the land.) However, because the allodial title is not in one owner’s name, but rather held communally, in the end it is like having no property rights at all.

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