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New Member
posted Jul 20, 2020 6:19:57 PM

Tax issues with 1099-Misc issued to a trust

If properties are placed in a trust, should the rental management company issue a 1099-Misc to the trust or to the person reporting the income? 

 

If a 1099-Misc is issued to a trust, could this create an obligation for a 1041? 

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1 Best answer
Level 15
Jul 20, 2020 6:54:07 PM

@ljinit wrote:

Thanks, if the W-9 has the name of the trust but the social of the taxpayer, would this create any issue?

Is this a grantor trust? If so, and the trust uses the SSN of the grantor, then the trust is treated as a disregarded entity for federal income tax purposes and the income would be reported on the individual income tax return of the grantor.

3 Replies
Level 15
Jul 20, 2020 6:32:37 PM

@ljinit wrote:

If a 1099-Misc is issued to a trust, could this create an obligation for a 1041? 

Yes, assuming the income exceeds the threshold for filing (which is very low). This would also assume that the property management company was given the EIN of the trust.

New Member
Jul 20, 2020 6:33:43 PM

Thanks, if the W-9 has the name of the trust but the social of the taxpayer, would this create any issue?

Level 15
Jul 20, 2020 6:54:07 PM

@ljinit wrote:

Thanks, if the W-9 has the name of the trust but the social of the taxpayer, would this create any issue?

Is this a grantor trust? If so, and the trust uses the SSN of the grantor, then the trust is treated as a disregarded entity for federal income tax purposes and the income would be reported on the individual income tax return of the grantor.