FAQ Friday: Trusts and Taxes

On Friday, January 28th, at 11am EST, Mr. Berger discusses the types of taxes involved in Trusts.

Revocable trusts use your SSN and there is no need for a separate tax return. Irrevocable trusts have their own, which is called an EIN.

When married, for revocable trusts, either spouse can use their SSN. An estate separately would also need to file for an EIN number for their own tax return. They would file a 1041.

Oftentimes, it can be easier to file an estate and Trust separately, even if it can be filed with a person’s individual SSN.

Trusts for 2022, the highest tax rate is reached just north of 13K. Whoever filed the 1041 will issue a K1. If beneficiaries are paid out, the beneficiaries will also need to report that on their taxes.

An accountant that really understand the nuances of Trusts is very important.

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