Filing Process:
Enter the donor's name and Social Security Number on Lines 1a and 1b.
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If the donor is deceased, enter the estate representative's information on Line 3 and attach substantiating documents, such as letters of testamentary.
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On Line 6, enter "Form 709" for the type of return requested.
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On Line 7, specify the tax year for the return (e.g., 12/31/2024).
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Sign and date the form.
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Include fee.
EIN – Employer Identification Number
Estate Definitions:
Estate: An estate is a legal entity created as the result of a person’s death. The decedent’s estate is a separate legal entity for federal tax purposes. An estate consists of real and/or personal property of the deceased person. The estate pays any debts owed by the decedent and then distributes the balance of the estate’s assets to the beneficiaries of the estate. The estate exists until the final distribution of the assets is made to the heirs and other beneficiaries.
Fiduciary: A fiduciary is any person acting in a fiduciary capacity for any other person. A fiduciary for a decedent’s estate can be an executor, administrator, personal representative, or person in possession of property of a decedent’s estate. The primary duties of the fiduciary are to collect all the decedent’s assets, pay the creditors, and distribute the remaining assets to the heirs or other beneficiaries.
Form(s):
- Estates file either Form 706, United States Estate (and Generation-Skipping Transfer) Tax Return, or
- Form 1041, U.S. Fiduciary Return of Income, plus other returns that apply (such as employment or excise tax returns)
You will need a new EIN if any of the following are true:
- A trust is created with estate funds. Such trust is not simply a continuation of the estate.
- You represent an estate that operates a business after the owner’s death.
You will NOT need a new EIN if any of the following are true:
- The administrator, personal representative, or executor changes
- The beneficiaries of estate change
Trust Definitions - Trust:
A trust is an arrangement through which trustees take title to property for the purpose of protecting or conserving it for the beneficiaries under the ordinary rules applied in chancery or probate courts. A trust is a legal entity created under state law and taxed under federal law. A trust may be created during an individual’s lifetime (inter vivos) or at the time of his or her death under a will (testamentary).
Trusts include guardianships, custodianships, conservatorships, receiverships, escrow accounts, Ginnie Mae (GNMA) and Fannie Mae (FNMA) pools.
Fiduciary/Trustee:
A fiduciary is an individual or organization charged with the duty to act for the benefit of another. A trustee is a fiduciary. The trustee obtains legal title to the trust assets and is required to administer the trust on behalf of the beneficiaries according to the express terms and provisions of the trust agreement.
Beneficiary:
A beneficiary is a person designated as a recipient of funds or other property under a trust or an estate. Grantor: The grantor (also known as trustor, settlor, or creator) is the creator of the trust relationship and is generally the owner of the assets initially contributed to the trust. The grantor generally establishes, in the trust instrument, the terms and provisions of the trust relationship between the grantor, the trustee, and the beneficiary. The grantor may retain control over all or a portion of the trust, which may result in the grantor being subject to tax on the income from that portion of the trust.
Revocable/Irrevocable Trust:
An irrevocable trust is a trust, which, by its terms, cannot be modified, amended, or revoked. For tax purposes, an irrevocable trust can be treated as a simple, complex, or grantor trust, depending on the powers listed in the trust instrument.
A revocable trust may be revoked and is considered a grantor trust (IRC § 676). State law and the trust instrument establish whether a trust is revocable or irrevocable. If the trust instrument is silent on revocability, then most states consider the trust revocable.
Living Trust:
A living person creates an inter vivos trust during that person’s lifetime. An inter vivos trust can be established as revocable or irrevocable. An inter vivos trust can be a simple, complex, or grantor trust depending on the trust instrument.
Testamentary Trust:
A testamentary trust is created by a will, which begins its existence upon the death of the person making the will, when property is transferred from the decedent’s estate. Testamentary trusts are generally simple or complex trusts. A testamentary trust is irrevocable by definition, as it comes into being at the death of the grantor. A “trust under the will’ is the same as a testamentary trust.
Conservatorship:
Trust, not an estate, which is usually set up for an incompetent person.
Guardianship/Custodianship:
A trust usually set up for a minor. Form(s): Form 1041 U.S. Fiduciary Return of Income, plus other returns that apply (such as employment tax returns).
You will need a new EIN if any of the following are true:
- A trust changes to an estate
- A living (inter vivos) trust changes to a testamentary trust
- The revocable trust changes to an irrevocable trust
You will NOT need a new EIN if any of the following are true:
- The trustee changes
- The grantor or beneficiary changes his or her name or address.
Note: Separate EINs are needed if one person is the grantor/maker of multiple trusts. For example, if you have a trust for each of your grandchildren, each trust must have a separate EIN and file a separate tax return. However, a single trust with several beneficiaries requires only one EIN.
Filling out the Form SS-4 📌
Line 1 - Enter the first name, middle initial and last name of the decedent, followed by “Estate”.
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Line 2 - "N/A", Line 3 - Enter the name of the executor, administrator, or other fiduciaries.
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Lines 4a-b - Enter the mailing address. This is the address where all IRS correspondence will be sent.
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Lines 5a-b - Enter only if different from the mailing address on Lines 4a-b.
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Line 6 - Enter the county and state where the will is probated.
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Line 7a-b - "N/A", Line 8a - "N/A", Line 8b - "N/A", Line 8c - "N/A", Line 9a - Check “Estate” and enter the SSN of the decedent on the line provided.
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Line 9b - "N/A", Line 10 - Check the “Other” box and enter “Estate Administration”.
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Line 11 - Enter the date the estate was funded.
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Line 12 - Enter the last month of your accounting year or tax year.
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Line 13 - Enter the highest number of employees expected in the next 12 months (Agricultural, Household or Other). If none, enter 0 and skip to Line 16.
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Line 14 - If you expect your employment tax liability to be $1,000 or less in a full calendar year and want to file Form 944 annually instead of Forms 941 quarterly check “Yes”. (To file Forms 941, check “No”.)
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Line 15 - If the estate has (or will have) employees enter the date the estate will begin to pay wages (Month, Date, Year) If no employees, leave blank.
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Line 16 - Check the “Finance & Insurance” box.
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Line 17 - Enter “Estate Administration”.
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Line 18 - If the applicant shown on line one (1) ever previously applied for and received an EIN, check “yes”. If “yes” enter previous EIN on the line.
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Complete the Third Party Designee section only if you want to authorize the named individual to receive the EIN and answer questions about the completion of this form. You must also sign the application for the authorization to be valid. Name and Title: Print the name and title of the fiduciary. Telephone Number: Enter the telephone number where we can reach you if we have questions about your application. Signature: The fiduciary must sign the application if the Third Party Designee section is completed. Note: If you use an estate to create a trust, the trust is considered a different entity type and a new EIN is needed.
