1041

[Charliepdl2]

on the advice of my banker, I applied for an EIN for future used by my successor trustees, didn’t realize that this would trigger requirement to file additional tax returns for past years. Obviously, I am still alive and paying taxes every year using my SS#. is it possible to get a waiver on filing returns for my EIN or even canceling the EIN until my death? Thanks.

[Mike9241]

see if the financial institution will transfer to another account that uses just your SSN or will remove the EIN from the tax filings for your account. 

[dmertz]

As Mike9241 indicated, for your revocable living trust, your bank should normally be using and reporting with your SSN.  This is Optional Method 1.

It is permissible to have the income reported as income to the trust under the trust's EIN, but all payers are then to use the EIN and the trustee of the trust must then nominee the income to the individual (you, the grantor), generally an unnecessary complication compared to Optional Method 1.  With respect to 2023 income, the deadline to file the Forms 1099 to nominee the income to the individual was February 28, 2024 if filed manually or March 31, 2024 if filed electronically.  This is Optional Method 2.

There is also Optional Method 3, similar to Optional Method 2, used when there are multiple grantors.

With these optional reporting methods, no Form 1041 is filed.  In each case, the individual receives a Form 1099 to be reported on the individual's tax return, Form 1040.

Given the circumstances, Mike9241's suggestion to get the bank to correct the reporting to show the income as paid to your SSN and not to the EIN seems appropriate.

[Charliepdl2]

to clarify, I only got the EIN about two weeks ago so there has never been any income reported to that EIN. All income prior to the IRS assigning this new EIN has been reported and taxes paid or refunded using my SSN. However… I received a letter from the IRS with the following: “after reviewing your information, we have determined that you have not filed tax returns* dating as far back is 2020. Please file the returns by 5/01/24.”

* Of course not, Since I was using my SSN to report income to the IRS. sounds like my banker gave me some terrible advice. Unfortunately, he’s on vacation for a couple of weeks and the due date with the IRS is coming up. Any suggestions? Thanks