interest on trust savings

[crbrown8707]

my mother passed away in 2023, I did her 2024 taxes. There was a trust in both my parents name. I opened an "trust" account at my bank to handle any expenses that my mother's passing would encure. I got a 1099-int from the bank with the trust name which has interest on the savings, and money market account, and nothing on the checking account.  All other aspects of the trust are closed and the trust is no longer valid. How is the best way to file the taxes?

[DianeW777]

This is easily handled using the steps below to transfer the income to yourself and let the IRS know where the income belongs. Report the income on your tax return.

Nominee Returns.  This is how the IRS knows what you are doing.

Generally, if you receive a Form 1099 for amounts that actually belong to another person or entity, you are considered a nominee recipient. You must file a Form 1099 with the IRS (the same type of Form 1099 you received).  You must also furnish a Form 1099 to each of the other owners. 

File the new Form 1099 with Form 1096 (this is a transmittal for the 1099) by mailing to the Internal Revenue Service Center for your area. (Provided on the Form 1096)

• On each new Form 1099, list the trust as the payer and the other owner, as the recipient. On Form 1096, list the trust as the nominee filer, not the original payer.  The nominee is responsible for filing the subsequent Forms 1099 to show the amount allocable to each owner.

The forms filed with the IRS should be the red copy (use the form(s) needed) so if you don't have a color printer, go to the IRS website to fill in and print the forms here: : 

• Form 1096
• Form 1099-INT