Irs Section 645

Under section 645 if both the executor if any of an estate and the trustee of a qualified revocable trust qrt elect the treatment provided for in section 645 the trust is taxed for income tax purposes as part of the estate and.

Irs section 645. 645 b 2 applicable date. Advantages that would not have been available to the trust if not for the election. When the executor if there is one or trustee of your estate make a section 645 election the trust is treated for income tax purposes as part of the decedent s estate for all tax years of the estate ending after the decedent s date of death and before the applicable date.

This election allows a qrt to be treated and taxed for income tax purposes as part of its related estate during the election period. A form 706 is not required to be filed as a result of a s death. The election must be made on irs form 8855 election to treat a qualified revocable trust as part of an estate by the due date including extensions of the estate s initial income tax return.

The term qualified revocable trust means any trust or portion thereof which was treated under section 676 as owned by the decedent of the estate referred to in subsection a by reason of a power in the grantor determined without regard to section 672 e. The trustees of each qualified revocable trust qrt and the executor of the related estate if any use this form to make a section 645 election. Congress created an opportunity for trustees of a funded revocable trust to utilize certain tax advantages under section 645.

Certain revocable trusts treated as part of estate. Advantages of making the election. A taxpayer identification number must be obtained by both the electing qrt and the related estate.

Irc 645 provides an irrevocable election to treat a qualified revocable trust as part of the decedent s estate for federal income tax purposes. The last day of the election period is october 19 2004. Generally estates have the ability to elect a fiscal year end or a calendar year end whereas trusts default to a calendar year end.

For purposes of this subtitle if both the executor if any of an estate and the trustee of a qualified revocable trust elect the treatment provided in this section such trust shall be treated and taxed as part of such estate and not as a separate trust for all taxable years of the estate ending after the date of the decedent s death and before the applicable date. The applicable date is october 20 2004 the day that is two years after a s date of death. Form 8855 is used to make a section 645 election which election allows a qualified revocable trust to be treated and taxed for income tax purposes as part of its.