Family trust 2 grantors/settlors

[t74]

What is the name of your state? OK

We have an old trust which never had any income or bank account. Everything is set to fund the trust upon the death of the owners. There are two individuals as settlors and trustees.

We now want to get a bank account for the trust but cannot get an EIN number due to the age of the trust.

Is there a way to reaffirm the trust and get it a new date other than duplicating it and all the notary signatures again?

Since the "owners" of the trust file as married filing jointly, can the SSN for one be that associated with the trust? What happens if that person dies first? Can the ownership of the trust's bank account be transferred to the other owner of the trust?

Is it better to just start all over? I hate to do this since there are other documents linked to the trust and have had terrible experiences with attorneys other than the one who did these documents? I would consider duplicating the document and just updating the dates with a new notary and witnesses.

 

[Taxing Matters]

Has the trust ever been funded with any assets (bank accounts, investment accounts, real estate or anything else) before now? And is the trust a revocable living trust of you and your wife, i.e. were you the ones who set it up and do you and your wife have the power to revoke the trust at any time?

 

[TrustUser]

as a general rule, the grantors use their ssn for filing, if this is a typical revocable trust. in fact, there would be no such thing as getting an ein for it, in this case. the federal govt does not recognize a revocable living trust as anything. all assets are part of your taxable estate (albeit the tax limit is now extremely high)

if a bank account is owned by a trust, the trustee's name will be on the bank account. i see no reason why both names cant be on the bank account. when one dies, the living spouse simply presents the death certificate, to remove the name of the dead grantor. however, generally either trustee has the power to remove all the money.

when both grantors die, the beneficiary needs to present the trust document, as well as the death certificates of the grantors

 

[TrustUser]

also, if this is a normal revocable trust, there is no need to make any changes to it (unless you desire to do so)

 

[t74]

Has the trust ever been funded with any assets (bank accounts, investment accounts, real estate or anything else) before now? And is the trust a revocable living trust of you and your wife, i.e. were you the ones who set it up and do you and your wife have the power to revoke the trust at any time?

Never funded Yes to rest of questions

 

[t74]

as a general rule, the grantors use their ssn for filing, if this is a typical revocable trust. in fact, there would be no such thing as getting an ein for it, in this case. the federal govt does not recognize a revocable living trust as anything. all assets are part of your taxable estate (albeit the tax limit is now extremely high)

if a bank account is owned by a trust, the trustee's name will be on the bank account. i see no reason why both names cant be on the bank account. when one dies, the living spouse simply presents the death certificate, to remove the name of the dead grantor. however, generally either trustee has the power to remove all the money.

when both grantors die, the beneficiary needs to present the trust document, as well as the death certificates of the grantors

Whose SSN? The same name is listed first as settlor and trustee and is the one in the better health and has most of the assets.

 

[TrustUser]

when i write my trust, there is a section for the tax identification number. i simply say "this trust is considered to be a revocable grantor trust, so it does not require an irs tax identification number while the grantor is alive. income from the assets of this trust will continue to be reported as usual, under the social security number of the grantor

 

[TrustUser]

basically, your trust has absolutely no effect on your taxes. you keep doing your taxes as you always have. traditionally a couple does a married return, and uses the social of the husband. but i would think you would want to continue to do your taxes just like you have in the past.

 

[TrustUser]

in my opinion, one of the biggest topics a couple should consider in their combined trust is the beneficiaries, when the first grantor dies. does that first grantor have some say as to the eventual beneficiaries ? or does the surviving grantor get total say ? something the couples should be aware of. and be in total agreement to.

 

[t74]

also, if this is a normal revocable trust, there is no need to make any changes to it (unless you desire to do so)

I prefer to keep this one.

Thanks all! You are a better source of info than the lawyers I have paid.

in my opinion, one of the biggest topics a couple should consider in their combined trust is the beneficiaries, when the first grantor dies. does that first grantor have some say as to the eventual beneficiaries ? or does the surviving grantor get total say ? something the couples should be aware of. and be in total agreement to.

Since the only beneficiaries are our children, and the survivor would be unlikely to remarry due to health, age, and long term marriage (50+ years), this is not an issue in our case, however it definitely should be a consideration. I, unfortunately, have to make all the financial decisions and have been asked by children to leave detailed instructions which I am working on. My spouse would likely decline to serve in favor of the successor trustees due to health related issues should I die first.

Both successor trustees are financially well situated and are protective of their other siblings; I trust them to be more likely to forego distributions to benefit themselves in favor of the others.

 

[TrustUser]

i am glad that your situation is a good one. most situations are. it is just that 99% of the ones that come on here arent so good !!

 

[Taxing Matters]

Never funded Yes to rest of questions

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.

 

[TrustUser]

hi tm, have you ever been involved with a bank insisting on an ein for a revocable trust ?

if so, was it in louisiana ?

 

[Taxing Matters]

hi tm, have you ever been involved with a bank insisting on an ein for a revocable trust ?

if so, was it in louisiana ?

I have seen a few banks that want an EIN for any trust, regardless of whether they are revocable or not. I have no experience with banks in Louisiana and that state is an oddity in a lot of respects when it comes to the law since its origins stem from French civil law rather than English common law. So even things that are are pretty much universal in other states may not be the case in Louisiana.

 

[TrustUser]

LOL - that is why i asked about it - all i know about louisiana trust law is that i dont want to know about it !!

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