topic Grantor Living trust owner of S Corp in Business & farm

Grantor Living trust owner of S Corp

fastfeet1010 — Wed, 08 Jan 2025 12:13:42 GMT

I have a living trust (Revocable Trust for John Smith). There is no EIN for the trust. The trust is a shareholder in an scrop. In the end, I know all the taxes flow to me as an individual for the taxes owed for the trust. What do I enter on the K1 for the scorp? My individual information or the Trusts information?

Re: Grantor Living trust owner of S Corp

Hi Palms — Wed, 08 Jan 2025 14:35:48 GMT

The trust is completely disregarded since you don't even have an EIN so you'd enter your individual information.

Re: Grantor Living trust owner of S Corp

DaveF1006 — Tue, 14 Jan 2025 19:34:58 GMT

Yes, HI Palms information is correct but here is some additional information that may be helpful.

Since the trust is a revocable trust, it is treated as a "grantor trust" for tax purposes, meaning the income and other tax items reported on the K-1 flow directly to the grantor (in this case, you, as the individual) for tax reporting.

For the K-1 form:

Name and address: The trust’s name (e.g., "Revocable Trust for John Smith") should be listed on the K-1 as the shareholder.
Tax Identification Number (TIN): Since the trust is a grantor trust, it typically does not have a separate EIN (Employer Identification Number). Instead, your individual Social Security Number (SSN) is used on the trust’s income tax return.
Distributive share of income and deductions: The K-1 will reflect the trust's share of the S-Corp income, deductions, and other items. this will flow to your individual tax return.

Re: Grantor Living trust owner of S Corp

fastfeet1010 — Wed, 15 Jan 2025 00:07:37 GMT

Thank you.

Is there anyway to provide an example what that looks like on the K1 of the 1120S?

Re: Grantor Living trust owner of S Corp

Hi Palms — Wed, 15 Jan 2025 16:45:15 GMT

Is there anyway to provide an example what that looks like on the K1 of the 1120S?

Not sure what you're asking for because the K-1 from the 1120-S will be generated when you prepare your 1120-S and that could contain any number of income, deduction, and credit items on various lines.

If the trust has an EIN, then that should be used for the K-1. If not, then your SSN should be used.