My grandmother passed away and she placed her home in an irrevocable trust for Medicaid purposes. Because she had limited power of appointment, it was considered an incomplete gift to the trust. As well as she had a right to live in the home and receive income (such as rent) if she desired. With all that, according to IRS section 2036, the house moved back into the gross estate. In that case do I still need to report my shares? The estate is much less than the federal and NY state reporting threshold. I know if it was a revocable trust I would not have to report it. But if I do in this case which form do I use?
