If I set up a revocable trust to avoid probate, with me as trustee, do I have to
get a tax ID# for the trust and file an income tax return each year?
I get this question a lot. The good news is ABSOLUTELY NOT!
The answer makes sense too because you really haven’t done anything that warrants it. What you have done is transferred some assets to a trust in which you retain 100% control. You can put assets in and take assets out whenever you want, and as trustee, you are calling all the shots. In reality, the assets in the trust are still your assets. In such cases, the IRS code says that the IRS will ignore these trusts for income tax purposes. The IRS treats the assets in the trust as still owned by you. As such, you can still use your social security number on the trust assets AND you have no obligation to file an annual income tax return for the trust. YAY!
I hope this helps! Please forward this information to your friends and relatives to share these informative answers to some very commonly asked questions.