Grantor trust

[aceliass]

Hello,

I have both personal taxes (already done/filed using TTax), and a revocable trust.  I reported trust income on my personal return believing that's how it can be done as I am the grantor (and it's revocable).  Then I found that my trust has an EIN assigned.  I think I have to go back and relate my trust EIN to my personal TIN by filing a 1041 with just the identifying info and the income on an attached statement.  If so, is the 1041 form that TTax provides only in the full business product, at $170!?  Or is it also in the 'self employed/small business' product for a more reasonable price, $109 I think?

As an aside, the trust income was well under $600, so I wonder if I even should have reported it?

TIA,

ACE

[JohnB5677]

You must prepare and file a 1041, and produce a K-1 that will be posted to your tax return.  You will also have to file an amended 1040 personal return and clear all of the trust information out of it, and then post the K-1.

The TurboTax Business software will be the correct product to produce a 1041.  TurboTax Self-Employed will not be appropriate.

[Anonymous_]

You should seek guidance from a tax professional, at least initially, to get the matter set straight.

A trust is generally required to file a 1041 if it has income of $600 or more or any taxable income.

See https://www.irs.gov/instructions/i1041

The only TurboTax product that can be used to prepare and file a 1041 is TurboTax Business, a product that must be installed and run in a Windows environment; there is no onlne or Mac version. Further, TurboTax Business cannot be used to prepare an individual income tax return (1040).

You should take note that, with respect to grantor trusts, there are optional methods of filing. Generally, if your financial institutions (and also anyone from whom you receive income) are issuing tax reporting statements using your individual name with your social security number, you should be able to use a method of filing that obviates the need for a 1041.

See https://www.irs.gov/instructions/i1041#en_US_2021_publink1000286019

See

[Anonymous_]

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@JohnB5677 wrote:

You must prepare and file a 1041, and produce a K-1 that will be posted to your tax return. 

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Grantor trusts, even if required to file a return (Form 1041), do not issue K-1s; they issue grantor information statements (aka grantor information letters).

[LizB1]

Where do you enter the Grantor trust information from the Grantor Letter?

[Anonymous_]

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@LizB1 wrote:

Where do you enter the Grantor trust information from the Grantor Letter?

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It should be obvious from the information in the GIS. 

Interest will be entered as such, dividends, etc.