Trustee too eager to sell?

Question

A client trustee is the grandson of a client who passed away 12/31/11. He is not a beneficiary. There are 3 benficiaries. It is a grantor (revocable) trust. He (the trustee) is getting things done, applying for a TIN, etc.

He is eager to sell some of the assets in order to be conservative and protect against market fluctuation. We all understand that he has 3 voices in his ear. ( ; But he's so eager to sell that he wants to know if he can do it even before the TIN for the trust is applied to the accounts which house those assets.

I am not a trust expert; that's clear by the nature of my question. But I'd rather hold him off from doing so (selling) until the TIN is applied.

Any thoughts?

Phil Marti · Accepted Answer

Someone should tell him he can get the TIN online in about 5 minutes at

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Whether or not he has it at the time of trade doesn't matter.

He looks to the trust document to see what his powers are.

Speaking as the recently finished executor of an estate with feuding beneficiaries, he looks to caller ID to see what calls to take.

Phil Marti VITA/TCE Volunteer Clarksburg, MD

Mark Bole · Answer

Tax info forms issued incorrectly under decedent's tax ID can be nominee'd (nominated?) to the trust.

Stuart A. Bronstein · Answer

Exactly. It would also be a good idea to talk to a lawyer to get advice with respect to the precise demands of the heirs.

If necessary you can take a trust to probate court. Getting court approval for what the trustee does will prevent heirs from successfully suing the trustee for doing things they don't like.

___ Stu

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EAgent · Answer

Phil is quite correct, he can get a TIN very quickly by going online to

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2767,00.htmland completing the application. Phil is also quite right when he sayshe MUST read and abide by the instructions in the trust document -failing to do so could open him up to some personal liability. Next, this is NO LONGER a revocable trust. It converted when grandpa passed.

And yes, he can dispose of trust assets while he doesn't have a TIN number. Since you don't do trust work you may not know, but once someone passes away you cannot put the income on the 1040. Instead, it goes on a Form 1041 IF the total income is over $600. This creates a bit of a paper-chase, if you will. Many times the issuing institution will issue a W-2 or 1099 in the name of the decedent. This gets put on the decedent's return AND IMMEDIATELY BACKED OFF THAT RETURN with a note that it is reported on Form 1041 using TIN XX- XXXXXXX. Yes, its a hassle, but it is what it is.

I am curious as to WHY you want him to hold off, especially since you have no trust experience.

Good luck, Gene E. Utterback, EA, RFC, ABA

Trustee too eager to sell?

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