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Mother just died, Father already dead. Parents have a

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Mother just died, Father already...
Mother just died, Father already dead. Parents have a revocable trust using Father's SSN. Bank wants a new EIN and to chance the trust to irrevocable. We are not making any changes just settling the estate and distributing money. Estate is well under $5 million. If the Trust name and date don't chance why a new EIN?
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Submitted: 1 year ago.Category: Tax
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5/22/2016
Tax Professional: Lane, JD, CFP, MBA, CRPS replied 1 year ago
Lane
Lane, JD, CFP, MBA, CRPS
Category: Tax
Satisfied Customers: 12,859
Experience: Law Degree, specialization in Tax Law and Corporate Law, CFP and MBA, Providing Financial & Tax advice since 1986
Verified

Hi,

...

When the second spouse passes, the trust becomes irrevocable (as the trustor is no longer alive to revoke it)

...

The trust is now a separate taxable entity, and must have a tax ID as all other irrevocable trusts.

...

This is just a legality. The bank likely cannot DO ANYTHING, because - when it was a revocable trust it was a passthrough entity and all taxation passed through to the grantor(s) of the trust's tax return.... Their systems are now looking for a tax ID for this trust.

...

Also, if the trust has more that $300 of income, (more than $300 of income after the date of death) there will need to be a form 1041 (INCOME tax return of a trust or estate) done to report that income

...

The bank will report that income (dividends, interest, rents, etc) on a 1099 to the trust rather than to the grantors as they could do while at least one grantor was alive.

...

YOu can do this very easily online by going here: https://sa.www4.irs.gov/modiein/individual/index.jsp

...

Then you'll simply give the ID to the bank

...

Please let me know if you have any questions at all.

...

If this HAS helped, and you DON’T have other questions … I'd appreciate a positive rating (using the smile or stars on your screen, and then clicking “submit”)

I receive no crediting at all unless you rate in this way.

...

Thank you!

Lane

I hold a law degree, (concentration in Tax Law, Estate law & Corporate law), an MBA, (specialization in finance & tax), as well as CFP and CRPS designations. - I’ve been providing financial, Social Security/Medicare, estate, corporate, both for-profit and non-profit, and tax advice, since 1986.

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Tax Professional: Lane, JD, CFP, MBA, CRPS replied 1 year ago

Hi, I’m just checking back in to see how things are going

...

Did my answer help?

...

Let me know…

Lane

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Tax Professional: Lane, JD, CFP, MBA, CRPS replied 1 year ago

Hi Jean,

...

Did you see my answer?

...

let me know if you need more here

...

Lane

..

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Lane
Lane
Lane, JD, CFP, MBA, CRPS
Category: Tax
Satisfied Customers: 12,859
12,859 Satisfied Customers
Experience: Law Degree, specialization in Tax Law and Corporate Law, CFP and MBA, Providing Financial & Tax advice since 1986

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