Family trust 2 grantors/settlors

[Taxing Matters]

i havent banked at a bank in a long, long time

Then you haven't done any banking in a long, long time

 

[TrustUser]

LOL - i only work with credit unions, have several of them

 

[t74]

A trust does not come into being until it is funded with at least one asset for the trustee to manage. A trust without any assets is known as a dry trust and a dry trust is really just a stack of papers. Because the trust is revocable it is a grantor trust under the Internal Revenue Code (IRC) and grantor trusts don't file their own tax returns. Instead, their income and expenses go directly on the returns of the trust grantors as though the grantors directly owned the assets of the trust. In short, a grantor trust is for the most part disregarded by the IRS.

What this means to you with respect to the EIN is two things. First, you don't need to have an EIN for the trust as far as the IRS is concerned because as a grantor trust the trust doesn't file it owns return and the income and expenses of the trust end up directly on your personal return. Second, should a bank insist on an EIN for a bank account for the trust, you can get an EIN from the IRS. But tell the IRS in the Form SS-4 that the date that the trust is started in the date the trust was first funded, not the date you drew up the trust papers. And be sure to indicate that the purpose of the EIN is only for banking. Otherwise the IRS might expect a trust return from you.

Thanks! You solved my problem!