Trust filing necessary or advisable?

[KenO]

Client died in 2021 and his investments passed through his trust long-enough to generate a whopping $2 of dividends. It would seem no trust return is necessary with that income, but the attorney did file for an EIN so is it advisable to file an initial and final return to be sure the IRS knows its closed out?

Thanks,

[Slippery Pencil]

I always tell the client since the income isn't above the filing threshold, no return is required.  I've never had a client decide to file a return in that case.  None of them have ever heard from the irs about it.

[Randall]

If there's an EIN, I recommend filing a final return just to close the EIN with IRS.

[Abby Normal]

Nah, the IRS knows that trusts and estates often don't file returns. I wouldn't file.

[mcbreck]

16 hours ago, KenO said:

Client died in 2021 and his investments passed through his trust long-enough to generate a whopping $2 of dividends. It would seem no trust return is necessary with that income, but the attorney did file for an EIN so is it advisable to file an initial and final return to be sure the IRS knows its closed out?

Thanks,

If they get the EIN there will likely be a letter asking why they didn't file. If they are okay with that, no need to file. If an IRS letter is going to freak them out, file it.

[Abby Normal]

There will not be an IRS letter since 1041 (and 1065) do not have absolute filing requirements like 1120S or 1120 do, only conditional filing requirements.

[Catherine]

I usually recommend filing with the "final" box checked, as I did have one trust years ago that had no requirement for its last year - and got a letter two years later wanting to know where the return was. For such returns I charge next to nothing because it's just name, address, EIN, and "final return" box checked.