[WSBAPT] EIN for settlement trust req'd

[Mark Vohr]

John -

            Two questions I think. One is whether you need and EIN.  I would think the trust should qualify as a grantor trust and you can use the minor's SS# for reporting purposes.   For what it is worth, our practice would probably be to get a separate EIN so as trustee we know that we are independently fulfilling all our tax reporting duties.  The second issue are the trust tax rates.  Unfortunately in your fact pattern since you have a minor you are stuck dealing with the Kiddie Tax rules.  Together that is likely to put the reporting in a relatively high (35%) reporting bracket.

Regards,

Mark

Mark C. Vohr, Esq.
Ohana Fiduciary Corp.
Ohana Financial Services
A Washington Trust Company
Mark C. Vohr, J.D., CPG, Principal
PO Box 33710  Seattle, WA  98133
T:  (206) 782-1189 F:  (206) 782-1434
mcv at ohanafc.com      www.ohanafc.com

From: wsbapt-bounces at lists.wsbarppt.com <wsbapt-bounces at lists.wsbarppt.com> On Behalf Of John Keckemet
Sent: Friday, October 16, 2020 11:58 AM
To: wsbapt at lists.wsbarppt.com
Subject: [WSBAPT] EIN for settlement trust req'd

Settlement trust (irrevocable) approved by court to receive funds related to a minor settlement for personal injuries.  Must an EIN be obtained for the trust?   None would be required if the parents were simply acting as guardians!  Would like to avoid requirement to prepare return or suffer trust tax rate.  Thanks.

John Keckemet, Attorney
[LKA Email 500]
1200 5th Avenue, Ste 1550
Seattle, Washington  98101
p. 206.728.5858  f. 206.728.5863
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