What are the first steps I should take when setting up a trust?
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Your first step should be to execute the trust and then put assets into it. You can retitle your bank accounts, retirement accounts, real property, anything. Put it into the name of the trust itself. You will also need to file Form SS-4 to apply for an EIN (Employer Identification Number) for the trust, since it will potentially file taxes.
Here is the IRS webpage on the free process for obtaining an EIN process.
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This is our first trust we are setting up and want to be sure we didn't overlook anything of importance or to make sure if anything we added that was a custom addition doesn't look off or incorrect.
Setting up your first trust can be a complex process. Have you already consulted with a lawyer specializing in trusts?
Not yet.
Are there any specific custom additions or clauses in the trust that you are concerned about?
Mostly to make sure if something happens to me or my wife or god forbid both of us, that the kids are going to be okay without a lot of issue.
Is there anything else the Lawyer should know before I connect you? Rest assured they'll be able to help with your trust setup.
No, no other items to note.
Hello! Thanks for using AskaLawyer. My name is Stephen, and I am an attorney ready to answer your questions with top-quality service.
Have you funded the trust? Put assets into it? Have a pour-over will (one that pours any non-trust assets through probate into the trust)?
Just structuring the trust now via eForms.
Your first step should be to execute the trust and then put assets into it. You can retitle your bank accounts, retirement accounts, real property, anything. Put it into the name of the trust itself. You will also need to file Form SS-4 to apply for an EIN (Employer Identification Number) for the trust, since it will potentially file taxes.
Here is the IRS webpage on the free process for obtaining an EIN process.
With assets like our primary home with a mortgage, does moving ownership to a trust cause any issues there we need to address?
I'd ask them, but they probably don't care. Still, it's worth asking and getting consent in writing. You never know. Better safe than sorry.
Does this change our tax structure since the trust technically owns all assets?
No. Not if it's revocable. Normally that changes when the first spouse passes and the trust becomes irrevocable.
Got it. I think that's all the questions I had for now, thanks for your help.
But be sure to put things in. You can also use joint, POD, TOD, or beneficiary status on assets to put them into the trust.
Not sure what any of that is?
Joint: you personally and the trust
Payable on death
Terminates on death (both go to the named entity upon death)
Beneficiary: naming a specific person or the trust to receive the asset upon death.
Got it, so more in line with active assets like bank accounts and such, right?
It'll change over the course of life, but yes. The more you have in the trust, the less the kids would need to do.
Should I select or not select Trust filing as an Estate under Sec. 645?
For what?
Don't make an EIN until it is executed.
Going through EIN setup now and that’s a question on one of the first pages on the IRS site.
So, is the trust fully signed?
No, it's establishing a trust.
Don't do the EIN yet. No point. Execute it first, then the EIN.
OK makes sense.
Is there a way to save this chat or download it so I can look back down the road?
It doesn't have to be quick. It just needs to be done sooner or later.
You can copy and paste it; it should be in your account section, or you can contact customer service. They have that ability.
OK, thanks again for your help.
Sounds good. Happy to help. Thank you very much. Take care now and be well!
