An irrevocable and revocable trust are two common types of trusts created by individuals who wish to leave assets to others. An irrevocable trust requires a tax ID number while a revocable trust does not. With an Irrevocable trust tax ID number, it provides identification for the trust. This type of trust allows an individual to transfer wealth or assets to beneficiaries legally without having to go through public probate.
With an irrevocable trust, an EIN number is already in place, so the trust is set up appropriately after the death of the individual who set up the trust. With a revocable trust, the living person has the freedom to change the trust or terminate it. While the individual is living, the trust uses their social security number for tax ID purposes. Once that individual passes away, a Federal Tax ID number or TIN must be created.
The EIN needs to be established so that the trust has an official tax ID number. This is done by filling out an SS-4 form. The trustee has the ability to get a new TIN by filling out this form.
Such forms can be found online at the IRS-EIN-Tax-ID site, providing trustees with easy access to applications. Once the death occurs, the trust becomes irrevocable and is considered a separate entity. The trustee needs to fill out separate income tax returns by using the EIN that is provided by the IRS.
This is done to pay the trust’s taxes. The EIN number will then replace the grantor’s social security number on all accounts that are listed under the name of the trust. To complete the process online, one simply needs to select the identity type of Estate of Deceased Individual and then fill out the information needed to obtain the number.