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Irrevocable Trust and K1

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    #1

    Irrevocable Trust and K1

    I have been given a "Grantor Statement" for a trust which is titled as an Irrevocable Trust. It is not a K1, but a detailed statement with dividends, stock sales, deductions (as on a Sch A) and detail statements.
    Also for same (new) client is a K1 from the estate of her father. Not the same EIN as the Grantor Statement...
    How do I report the Grantor Statement?
    I feel like a fish out of water.
    Thanks-
    ~poss
    "I am proud to pay taxes in the United States. The only thing is I could be just as proud for half the money." Arthur Godfrey
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    #2
    If memory serves, the amounts on the grantor statement are reported on the individual's tax return on the appropriate line. You just need to add the amount for interest, dividends, etc. with the payee being the grantor trust.

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      #3
      thank you!

      I appreciate it! I've never in 11 years of doing taxes, seen one of these. A friend of mine is an attorney and thought I knew what I was looking at... "fake it till you MAKE it" right?
      Really, I had checked TTB to no avail, and did a search on this board and still could not find a link. Is there a pub I need to read on this? Because I will study it.
      Always learning,
      ~poss
      "I am proud to pay taxes in the United States. The only thing is I could be just as proud for half the money." Arthur Godfrey

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        #4
        I have seen many of these in the past, and as I recall they are usually generated by the large trust departments from a bank. Some of the banks who generate these are better than others in presenting them in a readable format which makes sense (Wells Fargo as opposed to US Bank), and some attach 1099 statements so you can trace into the numbers. Like many things in this business, once you've seen a few of them, they are a piece of cake. One other thing to note, be careful about allocating trustee expenses if there is tax exempt interest involved.

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          #5
          Read TTB, page 21-17 under Grantor Trust Filing Methods. It will tell you that you have the option to just report everything on the 1040 as if the trust did not exist.

          BTW, a grantor trust is always a revocable trust. If the trust is an irrevocable trust, it is not a grantor trust and a 1041 is required.

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            #6
            there are 2 sources...

            ... one source is the grantor statement and the other is the irrevocable trust.
            What a wealth of knowledge and confidence I am gaining from you all.
            Thanks so much!
            ~p
            "I am proud to pay taxes in the United States. The only thing is I could be just as proud for half the money." Arthur Godfrey

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