How to determine if a trust is a grantor trust or a non-grantor trust

Course Description

Grantor trusts and non-grantor trusts are the two main types of funded trusts that hold assets. The type of trust you’re administering determines whether you must file Form 1041 for the trust, or declare all items of income and deduction on the grantor’s Form 1040.

All trusts have a grantor, the person who creates the trust. All trusts also involve trustees, beneficiaries, and remaindermen. The relationship of the grantor to the other individuals involved in the trust determines whether a trust is a grantor trust or a non-grantor trust.

Non-grantor trusts are treated as separate entities (like a C-Corporation). But grantors of grantor trusts maintain significant rights to the trust’s assets and income. Because of that, they’re treated as if they are direct owners of the trust assets (like a sole proprietorship).

Various tax proposals, such as a change to the tax treatment of grantor trusts and a proposed surcharge to undistributed income of a non-grantor trust, may increase the importance of determining a trust’s income tax status in 2022 and beyond.  

Speaker Griffin Bridgers in this CPE/CE webinar will answer the following major questions:

• What is a grantor trust, and how is the trust income of a grantor trust reported?
• What are the income, gift, and estate tax benefits of a grantor trust?
• What types of common trusts qualify for grantor trust treatment, and how can such treatment be avoided when desired?
• What powers can a grantor retain over trust to achieve grantor trust treatment?
• When might grantor trust status be achieved unintentionally?
• In what cases might a beneficiary be treated as a grantor of a trust?
• Is it possible to terminate the grantor trust status concerning the grantor or a beneficiary?

Learning Objectives

• To analyze what types of trusts qualify for grantor trust status, whether by retained power or by operation of the trust.
• To discuss how to cause the grantor, or a beneficiary, to be a deemed owner of trust assets without adverse transfer tax consequences.
• To investigate how to terminate grantor trust status concerning a grantor, or beneficiary, along with possible transfer tax consequences of doing so.

Recommended For

• This IRS Approved CE course is recommended for Tax partners, managers, and staff, CPAs, enrolled agents, tax return preparers, tax attorneys, and other practitioners who want to advise businesses and individuals with different tax implications of the grantor trust or a non-grantor trust.
  

Who Should Attend?

Webinar Qualifies For

• 2 CE Credit of Taxes for Tax Professionals (Approval No. IRS: GEHNZ-T-00848-21-S)
• 2 CE Credit of Taxes for Enrolled Agents (EA) (Approval No. IRS: GEHNZ-T-00848-21-S)
• 2 CPE Credit of Taxes for Certified Public Accountants (CPA-US)
• 2 CE Credit of Federal Tax Related Matters for California Registered Tax Preparers(CRTP) (Approval No. 6273-CE-0790)
• 2 CE Credit of Taxes for Annual Filing Season Program (AFSP)

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