Do you have the EIN# of the irrevocable trust? Why do you have the check issued to the beneficiaries as trustee?
Form 706 is estate tax return filed for the deceased mother. If the trust was irrevocable and named 3 beneficiairies than this would not be part of the estate.
Did the mother's will state that these amounts should be distributed to the heirs or to the trust for the benefit of the heirs?
You will have to provide detailed information regarding the estate distribution for me to address this situation better...
You might want to check with the Attorney...the checks should have been issued in the name of the beneficiaries - not as trustee..Unless...the decedent wanted the money to be distributed to the trust formed for the benefit of the heirs...in ehich case you will have to form the trusts and deposit the checks in the trust accounts.
Form 706 is filed with the IRS - estate tax return and it is filed for the decedent's estate.
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Please note: This advice is provided with the understanding that all the relevant facts have been provided by you. Any change in facts might affect the advice given and hence may not be relied on in such cases.
I would suggest you to talk to the Attorney handling the estate and ask him to reissue the check in personal names.
If the Attorney has some grounds for issuing the checks in the name as trustees than I would like to know that before I can suggest something else.
Certified Public Accountant (CPA)
CPA, MBA, Over 10 yrs of experience in tax planning and business consulting..
I would suggest you to meet with the Attorney to understand why this was done.
It is possible that you may be able to deposit the check in the revocable trust and than write checks to the three heirs from the revocable trust.
Alternatively, each of the heirs can form their own revocable trust and deposit the check in their own revocable trust.
For your purposes, you can apply for a EIN number as a trust (form it as a revocable trust) so you do not have to file a separate tax return. Please check with a local attorney to determine the trust formation requirements for your State.
Since this will be a revocable trust, there is no separate filing required..
You do not have to close the trust. Since they are revocable and you do not have separate filing requirements, the trust can continue. The income etc from the revocable trust is reported under the grantor(the person who is the owner(in layman terms)of the trust).
On the form SS-4 you can form trust to hold assets for the grantor.