I completed my mom's taxes for year 2021 this year. She passed in Dec of 2021. I still have her stocks that the stock company had me open a new tax id for her trust and moved her stocks to this account. $21K ish. When I finally sell all her stocks how to I manage the tax id? Do I do taxes for that tax id? I'm confused on how to manage this asset.
Hi @BrendaJ1 !
Great question.
Basically, yes the trust is now its own tax entity and must file its own tax return if there is taxable income. Selling stocks, or receiving dividends or interest, would be taxable income for the trust, and would mean the trust is required to submit an income tax return, Form 1041.
I hope that helps you!
All my best,
Adam, EA
TurboTax Live
Note that the trust will be required to file an income tax return (Form 1041) if it has gross income of $600 or more for the tax year or any taxable income for the tax year.
See https://www.irs.gov/instructions/i1041#en_US_2021_publink1000285943
Also, note that the trustee, depending upon the terms of the trust, can distribute the stocks, in kind, to the beneficiary(ies) and avoid filing a return entirely (assuming there is no other income or gain).