Social Security

Ask social security questions and get answers ASAP

Ask an Expert,
Get an Answer ASAP!

I am late in filling out the IRS form for my son's trust. I…

Customer Question
I am late in...

I am late in filling out the IRS form for my son's trust. I have the 2016, 1041 and combined forms 1099 in front of me but am confused as to how get stared. Can you walk me through the process? The most important questions, do I even need to fill out this tax form. We have never owed any taxes on this trust. Thank you.

Accountant's Assistant: The Retirement Accountant will know how to help. Is there anything else the Retirement Accountant should be aware of?

I don't think so other than the reason we have to trust account is because my son has a disability. We also have a second trust (3rd party) which I haven't filled a tax form for either as there is not a large amount of money in it.

Submitted: 8 months ago.Category: Social Security
Show More
Show Less
Ask Your Own Social Security Question
Customer reply replied 8 months ago
Posted by JustAnswer at customer's request) Hello. I would like to request the following Expert Service(s) from you: Live Phone Call.
Customer reply replied 8 months ago
Let me know if you need more information, or send me the service offer(s) so we can proceed.
Answered in 8 minutes by:
11/18/2017
Social Security Expert: SSA.Help4u.168, Accountant replied 8 months ago
SSA.Help4u.168
SSA.Help4u.168, Accountant
Category: Social Security
Satisfied Customers: 4,761
Experience: Tax Accountant
Verified

Hello. Thank you for choosing this Q&A service for assistance. My name is***** am reading over your inquiry. I will respond to you shortly.

Ask Your Own Social Security Question
Social Security Expert: SSA.Help4u.168, Accountant replied 8 months ago

Does either of the following apply to the trust?

----------------------------

The fiduciary (or one of the joint fiduciaries) must file Form 1041 for a domestic estate that has:

1. Gross income for the tax year of $600 or more, or

2. A beneficiary who is a nonresident alien.

If not, the Form 1041 does not need to be filed.

Ask Your Own Social Security Question
Social Security Expert: SSA.Help4u.168, Accountant replied 8 months ago

Is the trust a Qualified Disability Trust? If not, what type of trust is it?

Ask Your Own Social Security Question
Customer reply replied 8 months ago
Both are a special needs trust. I don't know what a Qualified Disability Trust is. There is no significant gross income for 2016 and certainly nothing approaching $600.00 income in either of the trusts I have for my son. Nor is he a nonresident alien. So depending on what a disqualified trust is I might not need to file.
Social Security Expert: SSA.Help4u.168, Accountant replied 8 months ago

Ok. The Form 1041 is used for decedent estates, so this is not the form that you need co complete. I will check on the filing requirements for a Special Needs Trust and get back to you shortly.

Ask Your Own Social Security Question
Social Security Expert: SSA.Help4u.168, Accountant replied 8 months ago

The following applies to a Special Needs Trust:

--------------------------------

Does the trustee of a special needs trust have to file an income tax return?

Trusts generally are considered separate taxable entities for income tax purposes, and the trustee must file an income tax return for the trust.

First-party special needs trusts

First-party special needs trusts are funded with the assets of an individual with a disability who is typically participating in a means-tested government benefit program such as Supplemental Security Income or Medicaid. First-party special needs trusts generally always receive the tax classification of a “grantor trust.” This tax classification means that all of the items of income, deduction and credit generated by the trust should be reflected on the personal income tax return of the individual with the disability, who is the trust beneficiary. In first-party special needs trusts, the grantor is actually the beneficiary because the law requires the trust be funded with the beneficiary’s own assets. (However, inexplicably, the law requires that the first-party special needs trust cannot be established by the beneficiary, even if competent, but rather must be established by a parent, grandparent, legal guardian or a court.)

Practice varies regarding how to report this income. Some trustees obtain a separate taxpayer identification number for the first-party special needs trust when it is established. As a result, when the time comes for financial institutions to report how much income the trust has earned, a Form 1099 will be issued to the trust reflecting the trust’s separate taxpayer identification number.

The question then becomes: how does this income, which is reported to the IRS under the trust’s separate taxpayer identification number, make its way onto the personal income tax return of the trust beneficiary? The answer is that the trustee of the first-party special needs trust files an informational Form 1041 with a grantor trust information letter attached. The mechanics of this informational filing are described in greater detail below.

Alternatively, in situations where the trustee of a first-party special needs trust does not obtain a separate taxpayer identification number for the trust, the beneficiary’s social security number is ***** as the taxpayer identification number for the trust. Since the beneficiary’s social security number is ***** on the Form 1099s issued by the financial institutions reporting the income earned by the trust, a separate informational Form 1041 is not generally filed.

Ask Your Own Social Security Question
Social Security Expert: SSA.Help4u.168, Accountant replied 8 months ago

For the Special Needs Trust, if the trust had income of at least $1.00, the Form 1041 does need to be completed and attached to return. SEE BELOW:

---------------------------

When must a Form 1041 be filed?

In the case of a first-party special needs trust which is a grantor trust for tax purposes and where a separate taxpayer identification number is ***** for the trust, the general rule is that if there is at least $1.00 of income, an informational return must be filed in order to provide the IRS with information about the taxpayer to whom that income should be taxed.

In the case of all other trusts, a Form 1041 generally must be filed if any one of the following three circumstances is applicable: (1) The trust had any taxable income for the tax year; (2) The trust had gross income of $600 or more (regardless of taxable income); or (3) The trust has a beneficiary who is a non-resident alien.

REFERENCE SOURCE:

https://www.specialneedsalliance.org/the-voice/filing-a-tax-return-for-a-special-needs-trust-what-a-trustee-needs-to-know-at-tax-time/

There is other information on the reference source page that will likely shed some light on the situation as well. It will be beneficial for you to review the information on that page.

------------------------------------------

In closing, my goal is to provide you with the best experience possible! Hopefully, the service that I have provided has earned a 5-star rating! Please remember to rate my service by selecting the 5 stars at the top of the screen before you leave today. Thank you in advance. If you require further assistance, use the reply box and let me know.

Ask Your Own Social Security Question
Was this answer helpful?

How JustAnswer works

step-image
Describe your issueThe assistant will guide you
step-image
Chat 1:1 with a social security expertLicensed Experts are available 24/7
step-image
100% satisfaction guaranteeGet all the answers you need
Ask SSA.Help4u.168 Your Own Question
SSA.Help4u.168
SSA.Help4u.168
SSA.Help4u.168, Accountant
Category: Social Security
Satisfied Customers: 4,761
4,761 Satisfied Customers
Experience: Tax Accountant

SSA.Help4u.168 is online now

A new question is answered every 9 seconds

How JustAnswer works:

  • Ask an ExpertExperts are full of valuable knowledge and are ready to help with any question. Credentials confirmed by a Fortune 500 verification firm.
  • Get a Professional AnswerVia email, text message, or notification as you wait on our site. Ask follow up questions if you need to.
  • 100% Satisfaction GuaranteeRate the answer you receive.

JustAnswer in the News:

Ask-a-doc Web sites: If you've got a quick question, you can try to get an answer from sites that say they have various specialists on hand to give quick answers... Justanswer.com.
JustAnswer.com...has seen a spike since October in legal questions from readers about layoffs, unemployment and severance.
Web sites like justanswer.com/legal
...leave nothing to chance.
Traffic on JustAnswer rose 14 percent...and had nearly 400,000 page views in 30 days...inquiries related to stress, high blood pressure, drinking and heart pain jumped 33 percent.
Tory Johnson, GMA Workplace Contributor, discusses work-from-home jobs, such as JustAnswer in which verified Experts answer people’s questions.
I will tell you that...the things you have to go through to be an Expert are quite rigorous.

What Customers are Saying:

I really was impressed with the prompt response. Your expert was not only a tax expert, but a people expert!!! Her genuine and caring attitude came across in her response...

T.G.WMatteson, IL

I WON!!! I just wanted you to know that your original answer gave me the courage and confidence to go into yesterday's audit ready to fight.

BonnieChesnee, SC

Great service. Answered my complex tax question in detail and provided a lot of additional useful information for my specific situation.

JohnMinneapolis, MN

Excellent information, very quick reply. The experts really take the time to address your questions, it is well worth the fee, for the peace of mind they can provide you with.

OrvilleHesperia, California

Wonderful service, prompt, efficient, and accurate. Couldn't have asked for more. I cannot thank you enough for your help.

Mary C.Freshfield, Liverpool, UK

This expert is wonderful. They truly know what they are talking about, and they actually care about you. They really helped put my nerves at ease. Thank you so much!!!!

AlexLos Angeles, CA

Thank you for all your help. It is nice to know that this service is here for people like myself, who need answers fast and are not sure who to consult.

GPHesperia, CA

< Previous | Next >

Meet the Experts:

dylatess

dylatess

ATTORNEY

3,467 satisfied customers

37 plus years of SSD practice

Megan C

Megan C

Certified Public Accountant (CPA)

4,582 satisfied customers

Licensed CPA, CMA, CFE, CGMA M.Accy Also Teach Accounting courses at Master's Level

LawTalk

LawTalk

Attorney

3,071 satisfied customers

I have 30 years of legal and litigation experience, including representing clients before the U.S. Social Security Administration.

R. Klein, EA

R. Klein, EA

Accountant

334 satisfied customers

Tax & Social Security Benefits specialist

Dimitry K., Esq.

Dimitry K., Esq.

Attorney

233 satisfied customers

Licensed in multiple jurisdictions, experienced business attorney.

AttorneyTom

AttorneyTom

Attorney

16 satisfied customers

Attorney

Stephanie O Joy, Esq

Stephanie O Joy, Esq

Soc. Sec. Attorney

3,283 satisfied customers

22+ years legal exp. - 12+ years owning/operating her own SSD Law practice.

< Previous | Next >

Related Social Security Questions
My step-son died 2/24/18. A few days before his death we
My step-son died 2/24/18. A few days before his death we filled out the IRS/SS forms for he self employment for the last 5 years. This should have brought his 1/4 coverage above 1 per year from 21. I … read more
Dr. Arthur Rubin
Dr. Arthur Rubin
Doctoral Degree
173 satisfied customers
I am the fiduciary of my now deceased partner's estate. She
I am the fiduciary of my now deceased partner's estate. She died in 2016, having been granted ssa diability. We had a joint checking account into which the lump sum for back pay disability was deposit… read more
Lane
Lane
JD, MBA, CFP, CRPS
Doctoral Degree
47 satisfied customers
My husband (we were separated) died and I just discovered an
My husband (we were separated) died and I just discovered an increase in my checking account. I understand I automatically get his social security instead of mine. My problem is I already received my … read more
Lev
Lev
Retired
Bachelor\u0027s Degree Equivalent
27,134 satisfied customers
MY son passed away last year and I have requested from
MY son passed away last year and I have requested from Social Security a copy of his W-2 form at the end of March. I see where a payment was taken out for this request but still have not heard by from… read more
Brian Michels
Brian Michels
Partner, CPA
Bachelors of Business Administration
199 satisfied customers
I need to know how to get a yearly social security statement
i need to know how to get a yearly social security statement for 2014. I have misplaced or destroyed my completed report in my paper shredder by accident or hid it from myself. I would appreciate any … read more
keeperumiami
keeperumiami
Sr Financial & Tax Consultant
Bachelor\u0027s Degree
1 satisfied customers
How can I get My 1099 for 2016 I never received it in the
Hello, How can I get My 1099 for 2016 I never received it in the mail … read more
keeperumiami
keeperumiami
Sr Financial & Tax Consultant
Bachelor\u0027s Degree
1 satisfied customers
Toatal amount of social security I received in 2016? My son
Toatal amount of social security I received in 2016? … read more
keeperumiami
keeperumiami
Sr Financial & Tax Consultant
Bachelor\u0027s Degree
1 satisfied customers
I'm trying to do my taxes for 2016. Unfortunately I don't
I'm trying to do my taxes for 2016. Unfortunately I don't have my 2016 form for my SSA. Can you help me? … read more
keeperumiami
keeperumiami
Sr Financial & Tax Consultant
Bachelor\u0027s Degree
1 satisfied customers
Ed to get the Benefit award letter for my Step-mom Milan. I
ed to get the Benefit award letter for my Step-mom Martha Jane Milan. I am her POA … read more
keeperumiami
keeperumiami
Sr Financial & Tax Consultant
Bachelor\u0027s Degree
1 satisfied customers
Am filling out ssrp form for my 6 year old autistic son am
hello am filling out ssrp form for my 6 year old autistic son am confused on how to list out his expenses … read more
Dr. Fiona Chen
Dr. Fiona Chen
President
Ph.D.
1,172 satisfied customers
We are guardians for our grandson that received a pension
We are guardians for our grandson that received a pension from his father being on disability. We received notice that the pension was being stopped until Dec. 2016 because of his father working in 20… read more
Dr. Fiona Chen
Dr. Fiona Chen
President
Ph.D.
1,172 satisfied customers
I received an overpaid notice from Social Security. I never
I received an overpaid notice from Social Security. I never received the money, it went to another person, but Social Security wants me to pay it back. They are asking me to sign an authorization form… read more
PhillipsEsq.
PhillipsEsq.
Attorney
JD
822 satisfied customers
My son is disabled received ssi a few years ago. My husband
My son is disabled received ssi a few years ago. My husband got a better paying job so they told us my son no longer qualifies for ssi. This was three years ago. Now today i get a letter in the mail s… read more
PhillipsEsq.
PhillipsEsq.
Attorney
JD
822 satisfied customers
I am disabled and on social security disability. I was forced
I am disabled and on social security disability. I was forced into retirement because of my health in May 2014. In 2015, I withdrew $308,000 out of my employer 401K and used all the money (plus some o… read more
Lev
Lev
Retired
Bachelor\u0027s Degree Equivalent
27,134 satisfied customers
I am a filipino graduate nurse who works under working visa
i am a filipino graduate nurse who works under working visa in August 1974- March 1976 in Doctors Hospital,*****, Tucker, Ga. 30084 and South Fulton Hospital in***** East Point, Georgia 30344. At the … read more
Megan C
Megan C
Certified Public Accountant (CPA)
Master's Degree
4,582 satisfied customers
I am a payee son Carey Edward Timm. I filled out his
I am a payee son Carey Edward Timm. I filled out his form yesterday and made a big mistake on what was saved Dec. 2014 form. Sent it in Feb 2, 2015. I would like another form so I can correct the mist… read more
LawTalk
LawTalk
Attorney
Juris Doctor
3,071 satisfied customers
This all stared when we changed banks, We where with TDBank
This all stared when we changed banks, We where with TDBank and they moved out , we then went to BB&T bank, Ever thing wen well with my self and ma wife Account, our checks wend to our new bank. On No… read more
Shawn P Adamo
Shawn P Adamo
CEO
Bachelor's Degree
158 satisfied customers
For Alexia or Stephane. I filled and sent out SSA-454-BK form
For Alexia or Stephane. I filled and sent out SSA-454-BK form to SSA about 7 weeks ago. In this form I listed the name of doctors whom I am seeing for my disability. One of the doctors is my primary p… read more
Stephanie O Joy, Esq
Stephanie O Joy, Esq
Soc. Sec. Attorney
Doctoral Degree
3,283 satisfied customers
Disclaimer: Information in questions, answers, and other posts on this site ("Posts") comes from individual users, not JustAnswer; JustAnswer is not responsible for Posts. Posts are for general information, are not intended to substitute for informed professional advice (medical, legal, veterinary, financial, etc.), or to establish a professional-client relationship. The site and services are provided "as is" with no warranty or representations by JustAnswer regarding the qualifications of Experts. To see what credentials have been verified by a third-party service, please click on the "Verified" symbol in some Experts' profiles. JustAnswer is not intended or designed for EMERGENCY questions which should be directed immediately by telephone or in-person to qualified professionals.

Disclaimer: Information in questions, answers, and other posts on this site ("Posts") comes from individual users, not JustAnswer; JustAnswer is not responsible for Posts. Posts are for general information, are not intended to substitute for informed professional advice (medical, legal, veterinary, financial, etc.), or to establish a professional-client relationship. The site and services are provided "as is" with no warranty or representations by JustAnswer regarding the qualifications of Experts. To see what credentials have been verified by a third-party service, please click on the "Verified" symbol in some Experts' profiles. JustAnswer is not intended or designed for EMERGENCY questions which should be directed immediately by telephone or in-person to qualified professionals.

Show MoreShow Less

Ask Your Question

x