Thanks, @Anonymous_. Yeah, I'd hoped this was not too unusual with a revocable trust owning an interest in a family partnership, but given my inability to find much direction on point I am finding you are correct regarding the complexity of the scenario.
To answer your questions - Sorry I neglected to mention, but yes, Mom owns the other 99% through her revocable trust, and Dad owned 1% in his revocable trust. From what I can tell, though, the partnership does not immediately end upon his passing. The operating agreement from the LLC indicates that upon the death of a member, the trustee has all the rights of a member for the limited purpose of settling out the member's estate and that the substitution of a trustee does not cause a member to cease as a member. As for the tax partnership, I think the trust remains a partner until the partnership is liquidated. IRS Publication 541 mentions "For income tax purposes, a retiring partner or successor in interest of a deceased partner is treated as a partner until his or her interest in the partnership has been completely liquidated." (https://www.irs.gov/pub/irs-pdf/p541.pdf pg 12)
Is that the case even if the substitute trustee and ultimate beneficiary is the same person as the 99% partner?
