It depends. if the trust has an EIN (not always) and the assets are held in accounts using the EIN rather than his SSN, a grantor trust return needs to be file. a grantor trust is a disregarded entity and doesn't pay taxes and doesn't issue a K-1. such a return, if needed, would merely report the income and expenses on a schedule or listing which would then need to be entered in the appropriate sections of his tax return.
if an EIN is not used and no return, the activity would be reported as if the trust did not exist just the same as above .
not sure what you mean by two tax returns. as a grantor trust the income is reported by the grantor.
upon death of the grantor the trust becomes irrevocable and the trustee (sometimes the grantor names a person or entity other than the spouse) must follow the provisions of the trust. thus a trust return would need to be filed starting with the date of his death. I would suggest using a pro for the first year. you may even want to discuss the trust with a pro in advance. for example the trust may provide that upon death two other trusts are to be created a marital trust and a residual trust. (sometimes referred to as A and B trusts ) each of these trusts would need to file returns and the provisions usually differ.
