Liquidating trust and capital gain


08-Jul-2020 11:40

As with an irrevocable trust, an income tax return is only required if a revocable trust earned 0 or more during the year.And if it immediately dissolves, transferring all assets to its beneficiaries, an estate income tax return might not be required regardless of how much it earned.It’s typically a long-term arrangement, designed to live on regardless of whether the grantor dies.Revocable trusts are considered to be something of an extension of the grantor.Its income tax return is due on the 15th day of the fourth month after the end of its tax year.

When the grantor of a revocable trust dies, the trust then typically establishes its own separate tax ID number.As the name suggests, he can’t change his mind, take his property back and dissolve the trust.