| REG-106542-98 |
December 17, 2000 |
Election to Treat Trust as Part of an Estate
DEPARTMENT OF THE TREASURY
Internal Revenue Service 26 CFR Parts 1, 301, and 602
[REG-106542-98] RIN 1545-AW24
TITLE: Election to treat trust as part of an estate
AGENCY: Internal Revenue Service (IRS), Treasury.
ACTION: Notice of proposed rulemaking and notice of public
hearing.
SUMMARY: This document contains proposed regulations that relate to
an election to have certain revocable trusts treated and taxed as
part of an estate. This document provides the procedures and
requirements for making the election, rules regarding the tax
treatment of the trust and the estate while the election is in
effect, and rules regarding the termination of the election. This
document also provides clarification of the reporting rules for a
trust, or portion of a trust, that is treated as owned by the
grantor, or another person under the provisions of subpart E
(section 671 and following) part I, subchapter J, chapter 1 of the
Internal Revenue Code, for the taxable year ending with the death of
the grantor or other person. In addition, this document provides
notice of a public hearing on these proposed regulations.
DATES: Written or electronic comments must be received by March 19,
2001. Requests to speak (with outlines of oral comments) at a public
hearing scheduled for February 21, 2001, at 10 a.m., must be
submitted by January 31, 2001.
ADDRESSES: Send submissions to: CC:M&SP:RU (REG-106542-98), room
5226, Internal Revenue Service, POB 7604, Ben Franklin Station,
Washington, DC 20044. Submissions may also be hand delivered Monday
through Friday between the hours of 8 a.m. and 5 p.m. to: CC:M&SP:RU
(REG-106542-98), Courier�s Desk, Internal Revenue Service, 1111
Constitution Avenue, NW., Washington, DC. Alternatively, taxpayers
may submit comments electronically via the Internet by selecting the
"Tax Regs" option on the IRS Home Page, or by submitting comments
directly to the IRS Internet site at
http://www.irs.gov/tax_regs/reglist.html (the IRS Internet site).
The public hearing will be held in the IRS Auditorium, Internal
Revenue Building, 1111 Constitution Avenue, NW., Washington, DC.
FOR FURTHER INFORMATION CONTACT: Concerning the proposed
regulations, Faith Colson, (202) 622-3060; concerning submission of
comments, the hearing, and/or to be placed on the building access
list to attend the hearing, LaNita VanDyke, (202) 622-7180 (not
toll-free numbers).
SUPPLEMENTARY INFORMATION:
Paperwork Reduction Act
The collection of information in this notice of proposed
rulemaking has been reviewed and approved by the Office of
Management and Budget in accordance with the Paperwork Reduction Act
(44 U.S.C. 3507) under control number 1545-1578.
An agency may not conduct or sponsor, and a person is not
required to respond to, a collection of information unless it
displays a valid control number assigned by the Office of Management
and Budget.
Books or records relating to the collection of information must
be retained as long as their contents may become material in the
administration of any internal revenue law. Generally, tax returns
and tax return information are confidential, as required by 26
U.S.C. 6103.
Background
This document contains proposed regulations under section 645
relating to certain revocable trusts for which an election is made
to be treated and taxed as part of an estate. This document also
contains proposed amendments to the Income Tax Regulations under
section 671 relating to reporting for a trust, or portion of a
trust, for the taxable year ending with the death of the grantor or
other person treated as the owner of the trust, or portion of the
trust.
Explanation of Provisions
A. Overview of Section 645
Both estates and trusts can function to settle the affairs of a
decedent and distribute assets to heirs. In the case of a revocable
inter vivos trust, the grantor transfers property to a trust that
the grantor may revoke during the grantor�s lifetime. When the
grantor dies, the power to revoke ceases, and the trustee performs
the settlement functions typically performed by an estate executor.
See H.R. Conf. Rep. No. 220, 105 Cong., 1 th st Sess. at 711 (1997).
Section 1305 of the TRA 1997 added section 646 to the Internal
Revenue Code. Section 646 was redesignated section 645 by section
6013(a) of the Internal Revenue Service Restructuring and Reform Act
of 1998, Public Law 105-206 (112 Stat. 685)(1998). Section 645
provides that an election may be made to have certain revocable
trusts treated and taxed as part of an estate.
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 in section 645, the trust shall be treated and
taxed for income tax purposes as part of the estate (and not as a
separate trust) during the election period.
A QRT is any trust (or portion thereof) that on the date of
death of the decedent was treated as owned by the decedent under
section 676 by reason of a power held by the decedent (determined
without regard to section 672(e)). In accordance with the
legislative history accompanying section 645, the proposed
regulations provide that a trust that was treated as owned by the
decedent under section 676 solely by reason of a power held by a
nonadverse party is not a QRT. See H.R. Conf. Rep. No. 220, 105
Cong., 1 Sess. at 711 (1997). In addition, a trust that th st was
treated as owned by the decedent under section 676 by reason of a
power held by the decedent that was exercisable by the decedent only
with the approval or consent of another person is not a QRT.
Further, a QRT must be a domestic trust under section 7701(a)(30)
(E). A section 645 election for a QRT must result in a domestic
estate under section 7701(a)(30)(D). A section 645 election may be
made with respect to more than one QRT.
B. The Election
The section 645 election may be made whether or not a personal
representative is appointed for the decedent�s estate. Under the
proposed regulations, if a personal representative is appointed for
the decedent�s estate, the personal representative and the trustee
of the QRT make the section 645 election by A attaching a statement
to the Form 1041, U.S. Income Tax Return @ for Estates and Trusts,
filed for the first taxable year of the decedent�s estate (related
estate). If a personal representative is not appointed for the
decedent�s estate, the trustee makes a section 645 election for the
QRT by attaching a statement to the Form 1041 filed for the first
taxable year of the trust treating the trust as an estate.
Rev. Proc. 98-13 (1998-1 C.B. 370) sets forth procedures for
making the section 645 election. These proposed regulations, when
finalized, will replace Rev. Proc. 98-13. The proposed regulations,
in some instances, contain different procedures than those provided
in Rev. Proc. 98-13. Rev. Proc. 98-13, in most situations, requires
a trust that will make a section 645 election to obtain a taxpayer
identification number (TIN) and file a Form 1041 for the trust�s
short taxable year beginning with the decedent�s death and ending
December 31 of that year. In these situations, Rev. Proc. 98-13
provides that the section 645 election is made at the time the Form
1041 is filed for the trust. If a Form 1041 is not required to be
filed for the trust, the election is considered made when the Form
1041 is filed for the estate. The proposed regulations, however,
provide that if a section 645 election will be made for a trust, the
trustee and the personal representative, if any, may choose not to
obtain a TIN for the trust or file a Form 1041 for the trust�s short
taxable year. Under the proposed regulations, the section 645
election is considered made only upon the filing of a Form 1041,
with the required election statement attached, for the first taxable
year of the related estate, or, if there is no personal
representative, the first taxable year of the trust filing as an
estate.
C. General Form 1041 Filing Requirements and TINs for the Related
Estate and Electing Trust During the Election Period
During the election period, the personal representative files
one Form 1041 for the combined electing trust and related estate
under the name and TIN of the related estate. Thus, the electing
trust must furnish payors of the trust with the TIN of the related
estate. Except as required under the separate share rule of section
663(c), for purposes of filing the Form 1041 and computing the tax,
the items of income, deduction, and credit of the electing trust and
the related estate are combined. The proposed regulations do not
provide rules for apportioning the tax liability of the combined
estate and electing trust. The personal representative and trustee
must allocate the tax burden of the combined electing trust and
related estate to the trust and the estate in a manner that
reasonably reflects the tax obligations of each. If the tax burdens
are not reasonably allocated, gifts may be deemed to have been made.
If there is no personal representative, the trustee of the
electing trust must file a Form 1041 treating the trust as an estate
under section 645 during the election period. The trustee of the
trust must obtain a TIN to be used by the trust during the election
period to file as an estate and must furnish this TIN to payors of
the trust.
D. Tax Treatment of the Electing Trust and Related Estate During the
Election Period
Under the proposed regulations, the personal representative
treats the electing trust as part of the related estate for all
purposes of subtitle A of the Internal Revenue Code.
The electing trust and related estate are treated as separate
shares under section 663(c) for purposes of computing distributable
net income (DNI) and applying the distribution provisions of
sections 661 and 662. The proposed regulations provide rules for
adjusting the DNI of the separate shares with respect to
distributions made from one share to another share of the combined
electing trust and related estate to which sections 661 and 662
would apply had the distribution been made to a beneficiary other
than another share. Under the proposed regulations, the share making
the distribution reduces its DNI by the amount of the distribution
deduction that it would have been entitled to under section 661 had
the distribution been made to a beneficiary other than another share
of the combined related estate and electing trust, and, solely for
purposes of calculating its DNI, the share receiving the
distribution increases its gross income by this amount.
If there is no personal representative, the trustee of the
electing trust treats the trust as an estate for all purposes of
subtitle A of the Internal Revenue Code. Thus, the trustee of the
electing trust may adopt a taxable year other than a calendar year.
E. Duration of the Election Period
The proposed regulations provide that the election period
begins on the date of the decedent�s death and terminates on the day
before the applicable date. If a Form 706 is not required to be
filed for the decedent�s estate, the applicable date is the day
which is two years after the date of the decedent�s death.
If a Form 706 is required to be filed, the applicable date is
the day that is 6 months after the date of final determination of
liability for estate tax. The proposed regulations provide that the
final determination of liability for estate tax is the earliest day
on which any of the following has occurred: (A) the issuance of an
estate tax closing letter, unless a claim for refund with respect to
the estate tax is filed within six months after the issuance of the
letter; (B) the final disposition of a claim for refund that
resolves the liability for the estate tax, unless suit is instituted
within six months of the disposition of the claim; (C) the execution
of a settlement agreement that resolves the liability for estate
tax; (D) the issuance of a decision, judgment, decree, or other
order by a court of competent jurisdiction resolving the liability
for estate tax unless a notice of appeal or petition for certiorari
is filed within 90 days after the issuance of the decision,
judgment, decree, or other order of a court; or (E) the expiration
of the period of limitations for assessment of the estate tax
provided in section 6501.
F. Tax Treatment of the Electing Trust and Related Estate Upon
Termination of the Election Period
At the close of the last day of the election period, the
combined related estate and electing trust, if there is a personal
representative, or the electing trust, if there is no personal
representative, is deemed to distribute all the assets and
liabilities of the share (or shares) comprising the electing trust
to a new trust in a distribution to which sections 661 and 662
apply. Thus, the combined related estate and electing trust, or the
electing trust, as appropriate, is entitled to a distribution
deduction to the extent permitted under section 661 in the taxable
year in which the election period terminates as a result of the
deemed distribution. The new trust must include the deemed
distribution in gross income to the extent required under section
662.
At the end of the election period, the new trust must obtain a
new TIN. The related estate continues to report under the TIN
assigned to the combined related estate and electing trust during
the election period.
Following the termination of the election period, the taxable
year of the new trust must be the calendar year. The related estate
must continue to use the taxable year chosen by the combined related
estate and electing trust during the election period.
G. Clarification of the Reporting Rules for Grantor Trusts Under
�1.671-4
In the process of drafting these proposed regulations regarding
section 645, the IRS and the Treasury Department received many
taxpayer questions concerning the section 645 election procedures
and the proper application of the reporting rules under �1.671-4 to
a trust, or a portion of a trust, treated as owned by a grantor or
another person for the taxable year ending with the death of the
grantor or other person. Accordingly, these proposed regulations
amend �1.671-4 to clarify those reporting rules.
The proposed regulations clarify that a trust, or portion of a
trust, reports under �1.671-4 for the taxable year that ends with
the death of the grantor or other person (decedent) treated as the
owner of the trust. If the trust was filing a Form 1041 under
�1.671-4(a) during the life of the decedent, the proposed
regulations also provide that the due date for the return for the
trust or portion of the trust for the taxable year ending with the
death of the decedent shall be the date specified under section 6072
as though the decedent had lived throughout the decedent�s last
taxable year.
The proposed regulations provide that a trust that was wholly
owned by the decedent must obtain a new TIN upon the death of the
decedent whether or not a TIN was obtained for the trust prior to
the death of the decedent; however, if a section 645 election will
be made for the trust, a new TIN need not be obtained for the trust.
For administrative convenience, the proposed regulations clarify
that with respect to a trust which was treated as owned by two or
more grantors or other persons, following the death of one of the
deemed owners, the trust, including the portion formerly owned by
the decedent (if it remains part of the original trust following the
death of the deemed owner), continues to report under the TIN used
by the trust prior to the death of the decedent.
Proposed Effective Date
These regulations are proposed to apply on or after the date
that final regulations are published in the Federal Register.
Special Analyses
It has been determined that this notice of proposed rulemaking
is not a significant regulatory action as defined in Executive Order
12866. Therefore, a regulatory assessment is not required. It is
hereby certified that these regulations will not have a significant
economic impact on a substantial number of small entities. This
certification is based on the understanding of the IRS and Treasury
Department that the number of trusts and estates making the election
is not substantial, and none are small entities within the meaning
of the Regulatory Flexibility Act. Therefore, a Regulatory
Flexibility Analysis under the Regulatory Flexibility Act (5 U.S.C.
chapter 6) is not required. Pursuant to section 7805(f) of the
Internal Revenue Code, this notice of proposed rulemaking will be
submitted to the Chief Counsel for Advocacy of the Small Business
Administration for comment on its impact on small business.
Comments and Public Hearing
Before these proposed regulations are adopted as final
regulations, consideration will be given to any electronic or
written comments (a signed original and eight (8) copies) that are
submitted timely (in the manner described in the ADDRESSES caption)
to the IRS. The IRS and Treasury Department request comments on the
clarity of the proposed rules and how they can be made easier to
understand. All comments will be available for public inspection and
copying.
A public hearing has been scheduled for February 21, 2001,
beginning at 10 a.m., in the IRS Auditorium, Internal Revenue
Building, 1111 Constitution Avenue, NW., Washington, DC. Due to
building security procedures, visitors must enter at the 10 th
Street entrance, located between Constitution and Pennsylvania
Avenues, NW. In addition, all visitors must present photo
identification to enter the building. Because of access
restrictions, visitors will not be admitted beyond the immediate
entrance area more than 15 minutes before the hearing starts. For
information about having your name placed on the building A access
list to attend the hearing, see the FOR FURTHER @ INFORMATION
CONTACT section of this preamble.
The rules of 26 CFR 601.601(a)(3) apply to the hearing. Persons
who wish to present oral comments at the hearing must submit timely
written comments and an outline of the topics to be discussed and
the time to be devoted to each topic (signed original and eight (8)
copies) by January 31, 2001. A period of 10 minutes will be allotted
to each person for making comments. An agenda showing the scheduling
of the speakers will be prepared after the deadline for receiving
outlines has passed. Copies of the agenda will be available free of
charge at the hearing.
Drafting Information
The principal author of these regulations is Faith Colson,
Office of Associate Chief Counsel (Passthroughs and Special
Industries). However, other personnel from the IRS and Treasury
Department participated in their development.
List of Subjects
26 CFR Part 1
Income taxes, Reporting and recordkeeping requirements
26 CFR Part 301
Employment taxes, Estate taxes, Excise taxes, Gift taxes,
Income taxes, Penalties, Reporting and recordkeeping requirements
26 CFR Part 602
Reporting and recordkeeping requirements Proposed Amendments to
the Regulations
Accordingly, 26 CFR parts 1, 301, and 602 are proposed to be
amended as follows:
PART 1--INCOME TAXES
Paragraph 1. The authority citation for part 1 is amended by
adding an entry in numerical order to read in part as follows:
Authority: 26 U.S.C. 7805 * * *
Section 1.645-1 also issued under 26 U.S.C. 645. * * *
Par. 2. Section 1.641(b)-3 is amended by adding a sentence to
the end of paragraph (a) to read as follows:
�1.641(b)-3 Termination of estates and trusts.
(a) * * * Notwithstanding the above, if the estate has joined a
valid election under section 645 to treat a qualified revocable
trust, as defined under section 645(b)(1), as part of the estate,
the estate shall not terminate under this paragraph prior to the
termination of the section 645 election period. See section 645 and
the regulations thereunder for rules regarding the termination of
the section 645 election period.
* * * * *
Par. 3. In �1.642(c)-1, the last sentence of paragraph (a)(1)
is revised to read as follows: �1.642(c)-1 Unlimited deduction for
amounts paid for a charitable purpose.
(a) * * * (1) * * * In applying this paragraph without
reference to paragraph (b) of this section, a deduction shall be
allowed for an amount paid during the taxable year in respect of
gross income received in a previous taxable year, but only if no
deduction was allowed for any previous taxable year to the estate or
trust, or in the case of a section 645 election, to a related
estate, as defined under �1.645-1(b), for the amount so paid.
* * * * *
Par. 4. Section 1.645-1 is added under a new undesignated
center heading to read as follows:
Election to treat trust as part of an estate. �1.645-1 Election by
certain revocable trusts to be treated as part of estate.
(a) In general. If an election is filed for a qualified
revocable trust, as defined in paragraph (b)(1) of this section, in
accordance with the rules set forth in paragraph (c) of this
section, the qualified revocable trust is treated and taxed as part
of its related estate, as defined in paragraph (b)(4) of this
section (and not as a separate trust) during the election period, as
defined in paragraph (b)(6) of this section. Rules regarding the use
of taxpayer identification numbers (TINs) by an electing trust, as
defined in paragraph (b)(2) of this section, are in paragraph (d) of
this section. Rules regarding obtaining a TIN and filing
requirements for a qualified revocable trust for which a section 645
election will or may be made are also in paragraph (d) of this
section. Rules regarding the tax treatment of an electing trust and
related estate and the general filing requirements for the combined
entity during the election period are in paragraph (e)(2) of this
section. Rules regarding the tax treatment of an electing trust and
its filing requirements during the election period if no personal
representative, as defined in paragraph (b)(5) of this section, is
appointed for a related estate are in paragraph (e)(3) of this
section. Rules for determining the duration of the section 645
election period are in paragraph (f) of this section. Rules
regarding the tax effects of the termination of the election are in
paragraph (h) of this section. Rules regarding the tax consequences
of the appointment of a personal representative after a trustee has
made a section 645 election believing that a personal representative
would not be appointed for a related estate are in paragraph (g) of
this section.
(b) Definitions. For purposes of this section:
(1) Qualified revocable trust. A qualified revocable trust
(QRT) is any trust (or portion thereof) that on the date of death of
the decedent was treated as owned by the decedent under section 676
by reason of a power held by the decedent (determined without regard
to section 672(e)). A trust that was treated as owned by the
decedent under section 676 by reason of a power that was exercisable
by the decedent only with the approval or consent of another person
is not a QRT. In addition, a trust that was treated as owned by the
decedent under section 676 solely by reason of a power held by a
nonadverse party is not a QRT. A QRT must be a domestic trust as
defined in section 7701(a)(30)(E). A section 645 election for a QRT
must result in a domestic estate as defined in section 7701(a)(30)
(D).
(2) Electing trust. An electing trust is a QRT for which a
valid section 645 election has been made. Once a section 645
election has been made for the trust, the trust shall be treated as
an electing trust throughout the entire election period.
(3) Decedent. The decedent is the individual who was treated as
the owner of the QRT under section 676 on the date of that
individual�s death.
(4) Related estate. A related estate is the estate of the
decedent who was treated as the owner of the QRT on the date of the
decedent�s death. A related estate must be a domestic estate as
defined in section 7701(a)(30)(D).
(5) Personal representative. A personal representative is an
executor or administrator that has obtained letters of appointment
to administer the decedent�s estate through formal or informal
appointment procedures.
(6) Election period. The election period is the period of time
during which an electing trust is treated and taxed as part of its
related estate. The rules for determining the duration of the
election period are in paragraph (f) of this section.
(7) Payor. A payor is any person who is required by any
provision of the Internal Revenue Code and the regulations
thereunder to make any type of information return with respect to an
electing trust or the related estate for the taxable year. A payor
includes a person who makes payments to an electing trust or related
estate and a person who collects (or otherwise acts as a middleman
with respect to) payments on behalf of an electing trust or related
estate.
(c) The election--(1) Filing the election if there is a
personal representative--(i) Time and manner for filing the
election. If there is a personal representative of the related
estate, the trustee of the QRT and the personal representative of
the related estate make an election under section 645 and this
section to treat a QRT as part of its related estate in a written
statement described in paragraph (c)(1)(ii) of this section. The A
statement must be attached to the Form 1041, U.S. Income Tax @
Return for Estates and Trusts, filed for the first taxable year of
the related estate. See paragraph (e)(2) for rules regarding the
filing of this return. For the election to be valid, the Form 1041
and the attached statement must be filed not later than the time
prescribed under section 6072 (including extensions) for filing the
return for such taxable year.
(ii) Written statement. The written statement must--
(A) Identify the election as an election under section 645;
(B) Contain the name, address, date of death, and TIN of the
decedent;
(C) Contain the name and address of the QRT and, if a TIN has
been obtained after the death of the decedent, the TIN of the QRT;
(D) Contain the name, address and TIN of the related estate;
(E) Provide a representation that the trust for which the
election is being made meets the definition of a QRT under section
645 and paragraph (b)(1) of this section;
(F) Contain a statement from the personal representative,
signed and dated under penalties of perjury, stating that the
personal representative elects to treat the QRT as part of the
related estate under section 645 and that the personal
representative understands that the personal representative is
required to make a timely return of income for the combined related
estate and QRT on Form 1041 and to pay timely any tax due thereon;
and
(G) Contain a statement from the trustee of the QRT, signed and
dated under penalties of perjury, stating that the trustee elects to
treat the trust as part of the related estate under section 645 and
agrees to cooperate with the personal representative to insure that
a return of income is timely made for the combined related estate
and QRT, and that any tax due thereon is timely paid.
(2) Filing the election if there is no personal
representative--(i) Time and manner for filing the election. If
there is no personal representative for a related estate, an
election to treat a QRT as an estate is made by the trustee, in a
written statement described in paragraph (c)(2)(ii) of this section.
The statement must be attached to the Form 1041 filed for the first
taxable year of the QRT taking into account the trustee�s election
to treat the trust as an estate under section 645. See paragraph (e)
(3) for other rules regarding the filing of this return. For the
election to be valid, the Form 1041 of the QRT and the attached
statement must be filed not later than the time prescribed under
section 6072 (including extensions) for filing the return for such
taxable year.
(ii) Written statement. The written statement must--
(A) Identify the election as an election under section 645;
(B) Contain the name, address, date of death, and TIN of the
decedent;
(C) Contain the name and address of the QRT and, if a TIN has
been obtained after the death of the decedent, the TIN of the QRT;
(D) Provide a representation that the trust for which the
election is being made meets the definition of a QRT under section
645 and paragraph (b)(1) of this section;
(E) Provide a representation that there is no personal
representative and to the trustee�s knowledge and belief, one will
not be appointed;
(F) Contain the TIN obtained by the trust to file as an estate
under �301.6109-1(a)(4)(ii)(B) of this chapter; and
(G) Contain a statement from the trustee of the QRT, signed and
dated under penalties of perjury, stating that the trustee elects to
treat the trust as an estate under section 645 and that the trustee
understands that the trustee is required to make a timely return of
income for the trust on Form 1041 taking into account the section
645 election and to pay timely any tax due thereon.
(d) TIN for an electing trust and QRT--(1) Obtaining a TIN--
(i) For an electing trust--(A) If there is a personal
representative. If there is a personal representative, a TIN must be
obtained for the related estate but the electing trust is not
required to obtain a TIN in its own name. See �301.6109- 1(a)(4)(ii)
(A)(1) of this chapter for rules for completing the @ A Form SS-4,
Application for Employment Identification Number, filed for the
related estate.
(B) If there is no personal representative. If there is no
personal representative, the trustee must obtain a TIN to file as an
estate. See �301.6109-1(a)(4)(ii)(B) of this chapter for rules
regarding obtaining a TIN for an electing trust to file as an estate
during the election period. The trustee is not required to obtain a
TIN for the electing trust to file as a trust.
(ii) Obtaining a TIN and filing a Form 1041 for a QRT--(A)
Option not to obtain a TIN or file a Form 1041 for a QRT for which a
section 645 election will be made. If a section 645 election will be
made for a QRT, the personal representative of the related estate,
if any, and the trustee of the QRT may treat the QRT as an electing
trust from the decedent�s date of death until the due date for the
section 645 election. Accordingly, the trustee of the QRT is not
required to obtain a TIN for the QRT following the death of the
decedent as required under �301.6109-1(a)(3)(i) of this chapter or
file a Form 1041 for the QRT for the short taxable year beginning
with the decedent�s date of death and ending with December 31 of
that year. However, if a QRT is treated as an electing trust under
this paragraph from the decedent�s date of death until the due date
for the section 645 election and a valid section 645 election is not
made for the QRT, the QRT will be subject to penalties and interest
for failing to obtain a TIN and file a Form 1041 and pay the tax due
thereon.
(B) Requirement to obtain a TIN and file a Form 1041 for QRT if
paragraph (d)(1)(ii)(A) of this section does not apply--(1)
Requirement to obtain TIN and file Form 1041. If the trustee of the
QRT and the personal representative of the related estate, if any,
do not treat the QRT as an electing trust as provided under
paragraph (d)(1)(ii)(A) of this section, or if the trustee of the
electing trust and the personal representative, if any, are
uncertain whether a section 645 election will be made for a QRT, the
trustee of the QRT must obtain a TIN in the name of the QRT as
required under �301.6109-1(a)(3)(i) of this chapter and must file a
Form 1041 for the short taxable year beginning with the decedent�s
death and ending December 31 of that year (unless, the QRT is not
required to file a Form 1041 under section 6012 for this period).
(2) Requirement to amend return if section 645 election is
made. If a valid section 645 election is made for a QRT after a Form
1041 is filed for the QRT pursuant to paragraph (d)(1)(ii)(B)(1) of
this section, the trustee must amend the Form 1041. The trustee must
indicate on the Form 1041 that the return is a final return and must
attach a copy of the statement described in paragraph (c) of this
section to the amended Form 1041 filed pursuant to this paragraph.
In addition, the trustee must provide the following statement at the
top of the return: @ A FILED PURSUANT TO �1.645-1. The QRT�s
items of income, deduction, and credit must be excluded from the
amended Form 1041 filed under this paragraph and must be included on
the Form 1041 filed for the first taxable year of the related estate
under paragraph (e)(2)(ii)(A) of this section, if there is a
personal representative, or for the first taxable year of the
electing trust under (e)(3)(ii) of this section, if there is no
personal representative. The section 645 election is not considered
made upon the filing, under this paragraph, of an amended Form 1041
for the QRT with the attached statement. To be valid, a section 645
election must be filed in the time and manner specified in paragraph
(c) of this section.
(2) Furnishing TIN to payors--(i) If there is a personal
representative for a related estate. If there is a personal
representative, all payors of an electing trust shall be @ furnished
a Form W-9, @ Request for Taxpayer Identification Number @ and
Certification, or an acceptable substitute Form W-9 with the name
of the related estate as the primary name on the form, the name of
the electing trust as the secondary name on the form, the TIN of the
related estate, and the address of the trustee. The form must be
signed under penalties of perjury by the personal representative.
See section 3406 and the regulations thereunder for the information
to include on, and the manner of executing, the Form W-9, depending
on the type of reportable payments made by the payor to the trust.
(ii) If there is no personal representative. If there is no
personal representative, the trustee of the electing trust shall
furnish a Form W-9 or an acceptable substitute Form W-9 with the
name required by, and the TIN obtained under, �301.6109- 1(a)(4)(ii)
(B) of this chapter. See section 3406 and the regulations thereunder
for the information to include on, and the manner of executing, the
Form W-9, depending on the type of reportable payments made by the
payor to the trust.
(e) Tax treatment and general filing requirements of electing
trust and related estate during the election period--(1) Effect of
election. The section 645 election once made is irrevocable.
(2) If there is a personal representative--(i) Tax treatment of
the combined electing trust and related estate. If there is a
personal representative, during the election period the personal
representative treats the electing trust as part of the related
estate for all purposes of subtitle A of the Internal Revenue Code.
For example, the electing trust is treated as part of the related
estate for purposes of the subchapter S shareholder requirements of
section 1361(b)(1) and the special offset for rental real estate
activities in section 469(i)(4).
(ii) Filing requirements--(A) Filing the Form 1041 for the
combined electing trust and related estate during the election
period. If there is a personal representative, one income tax return
is filed under the name and TIN of the related estate for the
electing trust and the related estate. See �301.6109- 1(a)(4)(ii)(A)
(1) of this chapter. Except as required under the separate share
rule of section 663(c), for purposes of filing the Form 1041 under
this paragraph and computing the tax, the items of income,
deduction, and credit of the electing trust and related estate are
combined. One personal exemption in the amount of $600 is permitted
under section 642(b) and the tax is computed under section 1(e),
taking into account section 1(h), for the combined taxable income.
(B) Filing a Form 1041 for the electing trust is not required.
The trustee of the electing trust does not file a Form 1041 for the
electing trust during the election period. In certain situations,
the trustee of a QRT may be required to file a Form 1041 for the
QRT�s short taxable year beginning with the decedent�s date of death
and ending December 31 of that year. See paragraph (d)(1)(ii) of
this section.
(iii) Application of the separate share rules--(A)
Distributions to beneficiaries (other than to a share (or shares) of
the combined electing trust and related estate). Under the separate
share rules of section 663(c), the electing trust and related estate
are treated as separate shares for purposes of computing
distributable net income (DNI) and applying the distribution
provisions of sections 661 and 662. Further, the electing trust
share or the related estate share may each contain two or more
shares. Thus, if during the taxable year, a distribution is made by
the electing trust or the related estate, the DNI of the share
making the distribution must be determined and the distribution
provisions of sections 661 and 662 must be applied using the
separately determined DNI applicable to the distributing share.
(B) Adjustments to the DNI of the separate shares for
distributions between shares to which sections 661 and 662 would
apply. A distribution from one share to another share to which
sections 661 and 662 would apply if made to a beneficiary other than
another share of the combined related estate and electing trust
affects the computation of the DNI of the share making the
distribution and the share receiving the distribution. The share
making the distribution reduces its DNI by the amount of the
distribution deduction that it would be entitled to under section
661, had the distribution been made to another beneficiary, and,
solely for purposes of calculating DNI, the share receiving the
distribution increases its gross income by the same amount. The
distribution has the same character in the hands of the recipient
share as in the hands of the distributing share. The following
example illustrates the provisions of this paragraph (e)(2)(iii)(B):
Example. (i) A�s will provides that after the payment of debts,
expenses, and taxes, the residue of A�s estate is to be distributed
to Trust, an electing trust. The sole beneficiary of Trust is C. The
estate share has $15,000 of gross income, $5,000 of deductions, and
$10,000 of taxable income and DNI for the taxable year based on the
assets held in A�s estate. During the taxable year, A�s estate
distributes $15,000 to Trust. The distribution reduces the DNI of
the estate share by $10,000, the amount of the distribution
deduction A�s estate would be entitled to if A�s estate made the
distribution to a beneficiary other than Trust.
(ii) For the same taxable year, the trust share has $25,000 of
gross income and $5,000 of deductions. None of the modifications
provided for under section 643(a) apply. In calculating the DNI for
the trust share, the gross income of the trust share is increased by
$10,000, the amount of the reduction in the DNI of the estate share
as a result of the distribution to Trust. Thus, solely for purposes
of calculating DNI, the trust share has gross income of $35,000, and
taxable income of $30,000. Therefore, the trust share has $30,000 of
DNI for the taxable year.
(iii) During the same taxable year, Trust distributes $35,000
to C. The distribution deduction reported on the Form 1041 filed for
A�s estate and Trust is $30,000. As a result of the distribution by
Trust to C, C must include $30,000 in gross income for the taxable
year. The gross income reported on the Form 1041 filed for A�s
estate and Trust is $40,000.
(iv) Application of the governing instrument requirement of
section 642(c). A deduction is allowed in computing the taxable
income of the combined related estate and electing trust to the
extent permitted under section 642(c) for--
(A) Any amount of the gross income of the related estate that
is paid or set aside during the taxable year pursuant to the terms
of the governing instrument of the related estate for a purpose
specified in section 170(c); and
(B) Any amount of gross income of the electing trust that is
paid or set aside during the taxable year pursuant to the terms of
the governing instrument of the electing trust for a purpose
specified in section 170(c).
(3) If there is no personal representative--(i) Tax treatment
of the electing trust. If there is no personal representative,
during the election period the trustee treats the electing trust as
an estate for all purposes of subtitle A of the Internal Revenue
Code. Thus, for example, an electing trust is treated as an estate
for purposes of the set-aside deduction under section 642(c)(2), the
subchapter S shareholder requirements of section 1361(b)(1), and the
special offset for rental real estate activities under section
469(i)(4). The trustee may also adopt a taxable year other than a
calendar year.
(ii) Filing the Form 1041 for the electing trust. If there is
no personal representative, during the election period the trustee
of the electing trust must file Form 1041 treating the trust as an
estate. See �301.6109-1(a)(4)(ii)(B) of this chapter for rules
regarding the name and TIN to be used in filing a Form 1041 under
this paragraph (e)(3)(iii). Any return filed by a trustee of an
electing trust, in accordance with this paragraph, shall be treated
under section 6012 as a return filed for the electing trust and not
as a return filed for any subsequently discovered related estate.
Accordingly, the period of limitations provided in section 6501 for
assessments with respect to a subsequently discovered related estate
does not start until a return is filed with respect to the related
estate.
(f) Duration of election period--(1) In general. The election
period begins on the date of the decedent�s death and terminates on
the day before the applicable date. The election does not apply to
successor trusts.
(2) Definition of applicable date--(i) Applicable date if no
Form 706 (United States Estate (and Generation Skipping Transfer)
Tax Return) is required to be filed. If a Form 706 is not required
to be filed for the decedent�s estate, the applicable date is the
day which is 2 years after the date of the decedent�s death.
(ii) Applicable date if a Form 706 is required to be filed. If
a Form 706 is required to be filed for the decedent�s estate, the
applicable date is the day that is 6 months after the date of final
determination of liability for estate tax. Solely for purposes of
determining the applicable date under section 645, the date of final
determination of liability is the earliest day on which any of the
following has occurred--
(A) The issuance by the Internal Revenue Service of an estate
tax closing letter, unless a claim for refund with respect to the
estate tax is filed within six months after the issuance of the
letter;
(B) The final disposition of a claim for refund, as defined in
paragraph (f)(2)(iii) of this section, that resolves the liability
for the estate tax, unless suit is instituted within six months
after a final disposition of the claim;
(C) The execution of a settlement agreement with the Internal
Revenue Service that determines the liability for the estate tax;
(D) The issuance of a decision, judgment, decree, or other
order by a court of competent jurisdiction resolving the liability
for the estate tax unless a notice of appeal or a petition for
certiorari is filed within 90 days after the issuance of a decision,
judgment, decree, or other order of a court; or
(E) The expiration of the period of limitations for assessment
of the estate tax provided in section 6501.
(iii) Definition of final disposition of claim for refund. For
purposes of paragraph (f)(2)(ii)(B) of this section, a claim for
refund shall be deemed finally disposed of by the Secretary when all
items have been either allowed or disallowed. If a waiver of
notification with respect to disallowance is filed with respect to a
claim for refund prior to disallowance of the claim, the claim for
refund will be treated as disallowed on the date the waiver is
filed.
(iv) Examples. The application of this paragraph (f)(2) is
illustrated by the following examples:
Example 1. A died on October 20, 1999. The personal
representative of A�s estate and the trustee of Trust, an electing
trust, made a section 645 election. A Form 706 is not required to be
filed for A�s estate. The applicable date is October 20, 2001, the
day that is two years after A�s date of death. The last day of the
election period is October 19, 2001. Beginning October 20, 2001,
Trust will no longer be treated and taxed as part of A�s estate.
Example 2. Assume the same facts as Example 1, except that a
Form 706 is required to be filed for A�s estate. The Internal
Revenue Service issues an estate tax closing letter accepting the
Form 706 as filed on March 15, 2001. The estate does not file a
claim for refund by September 15, 2001, the day that is six months
after the date of issuance of the estate tax closing letter. The
final determination of liability is March 15, 2001 and the
applicable date is September 15, 2001. The last day of the election
period is September 14, 2001. Beginning September 15, 2001, Trust
will no longer be treated and taxed as part of A�s estate.
Example 3. Assume the same facts as Example 1, except that a
Form 706 is required to be filed for A�s estate. The Form 706 is
audited and a notice of deficiency authorized under section 6212 is
mailed to the personal representative of A�s estate as a result of
the audit. The personal representative files a petition in Tax
Court. The Tax Court issues a decision resolving the liability for
estate tax on December 14, 2003 and neither party appeals. The final
determination of liability is December 14, 2003. The applicable date
is June 14, 2004, the day that is six months after the date of final
determination of liability. The last day of the election period is
June 13, 2004. Beginning June 14, 2004, Trust will no longer be
treated and taxed as part of A�s estate.
(g) Personal Representative appointed after the section 645
election is made--(1) Effect on the election. If a personal
representative for the related estate is not appointed until after
the trustee has made a valid section 645 election, the personal
representative is deemed to agree to the election and to accept the
associated responsibilities unless, within 60 days of appointment,
the personal representative notifies the trustee in writing of the
personal representative�s refusal to agree to the election. If the
personal representative refuses to agree to the election, the
election period terminates the day before the effective date of the
personal representative�s appointment. If the personal
representative and the trustee are the same person, the personal
representative cannot refuse to agree to the election.
(2) Continuation of election period. If the personal
representative does not refuse to agree to the section 645 election,
the personal representative of the related estate and the trustee of
the electing trust must file amended Forms 1041 reflecting the items
of income, deduction, and credit of the related estate and the
electing trust for all taxable years ending after the death of the
decedent. If the period of limitations for making assessments has
expired with respect to the electing trust for any of the Forms 1041
filed by the trustee, the personal representative must obtain a TIN
for the related estate and file Forms 1041 for any items of income,
deduction, and credit of the related estate that cannot be properly
included on amended forms for the electing trust.
(3) Termination of the election period. If the election period
terminates as a result of the personal representative�s refusing to
agree to the election, the personal representative must obtain a new
TIN for the related estate. The personal representative must file
returns under the new TIN for all taxable years of the related
estate ending after the death of the decedent. The trustee of the
electing trust is not required to amend any returns filed for the
electing trust during the election period. Following termination of
the election period, the trustee of the electing trust must obtain a
new TIN as required under �301.6109-1(a)(4)(iii) of this chapter.
(h) Treatment of an electing trust and related estate following
termination of the election--(1) The share (or shares) comprising
the electing trust is deemed to be distributed by its related estate
upon termination of the election period. On the close of the last
day of the election period, the combined related estate and electing
trust, if there is a personal representative, or, the electing
trust, if there is no personal representative, is deemed to
distribute the share (or shares, as determined under section 663(c))
comprising the electing trust to a new trust in a distribution to
which sections 661 and 662 apply. Thus, the combined related estate
and electing trust, if there is a personal representative, or the
electing trust, if there is no personal representative, is entitled
to a distribution deduction to the extent permitted under section
661 in the taxable year in which the election period terminates as a
result of the deemed distribution. The new trust shall include such
distribution in gross income to the extent required under section
662.
(2) Filing of the Form 1041 upon the termination of the section
645 election--(i) If there is a personal representative-- If there
is a personal representative, the Form 1041 filed under the name and
TIN of the related estate for the taxable year in which the election
terminates includes--
(A) The items of income, deduction, and credit of the electing
trust attributable to the period beginning with the first day of the
related estate and electing trust�s taxable year and ending with the
last day of the election period;
(B) The items of income, deduction, and credit, if any, of the
related estate for the taxable year; and
(C) A deduction for the deemed distribution of the share (or
shares) comprising the electing trust to the new trust as provided
for under paragraph (h)(1) of this section.
(ii) If there is no personal representative. If there is no
personal representative, the taxable year of the electing trust
closes on the last day of the election period. A Form 1041 is filed
in the manner prescribed under paragraph (e)(3)(ii) of this section
reporting the items of income, deduction, and credit of the electing
trust for the short period ending with the last day of the election
period. The Form 1041 filed under this paragraph includes a
distribution deduction for the deemed distribution provided for
under paragraph (h)(1) of this section. The Form 1041 must indicate
that it is a final return.
(3) Use of TINs following termination of the election. Upon
termination of the section 645 election, a former electing trust
must obtain a new TIN, as required under �301.6109-1(a)(4)(iii) of
this chapter. If the related estate continues after the termination
of the election period, the related estate must continue to use the
TIN assigned to the estate during the election period.
(4) Taxable year of estate and trust upon termination of the
election--(i) Estate. Upon termination of the election, if the
estate will continue, the taxable year of the estate is the same
taxable year used during the election period.
(ii) Trust. Upon termination of the election, the taxable year
of the new trust is the calendar year. See section 644.
(i) Reserved.
(j) Effective date. This section applies on or after the date
final regulations are published in the Federal Register.
Par. 5. Section 1.671-4 is amended as follows:
1. The text of paragraph (d) is redesignated paragraph (d)(1)
and a paragraph heading is added for newly designated paragraph (d)
(1).
2. Paragraph (d)(2) is added
3. Paragraphs (h) and (i) are redesignated as paragraphs (i)
and (j).
4. New paragraph (h) is added.
The additions and revisions read as follows: �1.671-4 Method of
Reporting.
* * * * *
(d) Due date and other requirements with respect to statement
required to be furnished by trustee--(1) In general. * * *
(2) Statement for the taxable year ending with the death of the
grantor or other person treated as the owner of the trust. If a
trust ceases to be treated as owned by the grantor, or other person,
by reason of the death of that grantor or other person (decedent),
the due date for the statement required to be furnished for the
taxable year ending with the death of the decedent shall be the date
specified by section 6034A(a) as though the decedent had lived
throughout the decedent�s last taxable year. See paragraph (h) of
this section for special reporting rules for a trust or portion of
the trust that ceases to be treated as owned by the grantor or other
person by reason of the death of the grantor or other person.
* * * * *
(h) Reporting rules for a trust, or portion of a trust, that
ceases to be treated as owned by a grantor or other person by reason
of the death of the grantor or other person--(1) Definition of
decedent. For purposes of this paragraph (h), the decedent is the
grantor or other person treated as the owner of the trust, or
portion of the trust, under subpart E, part I, subchapter J, chapter
1 of the Internal Revenue Code on the date of death of that person.
(2) In general. The provisions of �1.671-4 apply to a trust, or
portion of a trust, treated as owned by a decedent for the taxable
year that ends with the decedent�s death. Following the death of the
decedent, the trust or portion of a trust that ceases to be treated
as owned by the decedent, by reason of the death of the decedent,
may no longer report under �1.671-4. A trust, all of which was
treated as owned by the decedent, must obtain a new TIN upon the
death of the decedent, if the trust will continue after the death of
the decedent. See �301.6109- 1(a)(3)(i) of this chapter for rules
regarding obtaining a TIN upon the death of the decedent. An
electing trust as defined in �1.645-1(b)(2) is not required to
obtain a TIN following the death of the decedent. A qualified
revocable trust, as defined in section 645(b) and �1.645-1(b)(1),
for which a section 645 election will be made, need not obtain a
TIN. See �301.6109- 1(a)(4) of this chapter and �1.645-1(d)(1)(ii)
(A).
(3) Special rules--(i) Trusts reporting pursuant to paragraph
(a) of this section for the taxable year ending with the decedent�s
death. The due date for filing of a return pursuant to paragraph (a)
of this section for the taxable year ending with the decedent�s
death shall be the due date provided for under �1.6072-1(a)(2). The
return filed under this paragraph for a trust all of which was
treated as owned by the decedent must indicate that it is a final
return.
(ii) Trust reporting pursuant to paragraph (b)(2)(B) of this
section for the taxable year of the decedent�s death. A trust that
reports pursuant to paragraph (b)(2)(B) of this section for the
taxable year ending with the decedent�s death must indicate on each
Form 1096 (Annual Summary and Transmittal of the U.S. Information
Returns) that it files (or appropriately on magnetic media) for the
taxable year ending with the death of the decedent that it is the
final return of the trust.
(iii) Trust reporting under paragraph (b)(3) of this section.
If a trust has been filing under paragraph (b)(3) of this section,
the trustee may not report under that paragraph if any portion of
the trust has a short taxable year by reason of the death of the
decedent and the portion treated as owned by the decedent does not
terminate on the death of the decedent.
(4) Effective date. This paragraph (h) applies on or after the
date final regulations are published in the Federal Register.
Par. 6. Section 1.6072-1 is amended as follows:
1. The text of paragraph (a) is redesignated as paragraph (a)
(1) and a paragraph heading is added for newly designated paragraph
(a)(1).
2. Paragraph (a)(2) is added.
The additions are as follows: �1.6072-1 Time for filing returns
of individuals, estates, and trusts.
(a) In general--(1) Returns of income for individuals, estates
and trusts. * * *
(2) Return of trust, or portion of a trust, treated as owned by
a decedent--(i) In general. In the case of a return of a trust, or
portion of a trust, that was treated as owned by a decedent under
subpart E (section 671 and following), part I, subchapter J, chapter
1 of the Internal Revenue Code as of the decedent�s date of death
that is filed in accordance with �1.671- 4(a) for the fractional
part of the year ending with the date of death of the decedent, the
due date of such return shall be the fifteenth day of the fourth
month following the close of the 12- month period which began with
the first day of such fractional part of the year.
(ii) Effective date. This paragraph (a)(2) applies on or after
the date final regulations are published in the Federal Register.
PART 301-PROCEDURE AND ADMINISTRATION
Par. 7. The authority citation for part 301 continues to read
in part as follows:
Authority: 26 U.S.C. 7805 * * *
Par. 8. Section 301.6109-1 is amended as follows:
1. Paragraph (a)(2)(iii) is removed.
2. Paragraphs (a)(3) through (a)(6) are added.
The additions are as follows: �301.6109-1 Identifying numbers.
(a) * * *
(3) Obtaining a taxpayer identification number for a trust, or
portion of a trust, following the death of the individual treated as
the owner--(i) In general--(A) A trust all of which was treated as
owned by a decedent. In general, a trust all of which is treated as
owned by a decedent under subpart E (section 671 and following),
part 1, subchapter J, chapter 1 of the Internal Revenue Code as of
the decedent�s date of death must obtain a new taxpayer
identification number following the death of the decedent if the
trust will continue after the death of the decedent. See, however,
�301.6109-1(a)(4) for rules regarding obtaining a taxpayer
identification number for a qualified revocable trust, as defined in
section 645(b)(1), for which a section 645 election has been or will
be made.
(B) Taxpayer identification numbers of trust with multiple
owners. With respect to a portion of a trust treated as owned under
subpart E (section 671 and following), part 1, subchapter J, chapter
1 of the Internal Revenue Code by a decedent as of the date of the
decedent�s death, if, following the death of the decedent, the
portion treated as owned by the decedent remains part of the
original trust and the other portion (or portions) of the trust
continue to report under the taxpayer identification number assigned
to the trust prior to the decedent�s death, the portion of the trust
treated as owned by the decedent prior to the decedent�s death
continues to report under the taxpayer identification number used
for reporting by the other portion (or portions) of the trust.
(ii) Furnishing correct taxpayer identification number to
payors following the death of the decedent. If the trust continues
after the death of the decedent and is required to obtain a new
taxpayer identification number under paragraph (a)(3)(i)(A) of this
section, the trustee must furnish payors with a new Form W-9, or an
acceptable substitute Form W-9, containing the new taxpayer
identification number required under paragraph (a)(3)(i)(A) of this
section, the name of the trust, and the address of the trustee.
(4) Taxpayer identification numbers if a section 645 election
has been, or will be, made--(i) Definitions. For purposes of this
paragraph (a)(4), the terms qualified revocable trust (QRT),
electing trust, related estate, election period, and personal
representative shall have the meanings provided in �1.645-1(b) of
this chapter.
(ii) Taxpayer identification number to be used during the
election period--(A) If there is a personal representative--(1) In
general. If there is a personal representative for a related estate,
a taxpayer identification number does not need to be obtained for an
electing trust. The personal representative of the related estate
must obtain a taxpayer identification number in the name of the
estate. A trustee of a QRT for which a section 645 election will be
made and the personal representative of the related estate, if any,
may choose to treat the QRT as an electing trust and not obtain a
taxpayer identification number for the trust. See �1.645-1(d)(1)(ii)
(A) of this chapter. If the personal representative knows that a
section 645 election has been made for an electing trust or will be
made for a QRT at the time the personal representative files the
Form SS-4, @ A Application for Employer Identification Number,
for the related estate, the personal representative may enter the
name of the trust as a secondary name on the form. All returns filed
for the combined related estate and electing trust during the
election period must be filed using the name of the related estate
as the primary name on the return.
(2) Obligations of persons who make payments to electing
trusts. Any payor that is required to file an information return
with respect to payments of income or proceeds to an electing trust
must show the name of the related estate, as the primary name on the
return, the name of the electing trust as the secondary name on the
return, and the taxpayer identification number of the related estate
on the return. Nevertheless, the statement to recipients must be
furnished by the payor to the trustee of the trust, rather than the
personal representative of the related estate. Under these
circumstances, the payor satisfies all information reporting
sections that require the payor to show the name and taxpayer
identification number of the payee on the information return and to
furnish the statement to recipients to the person whose taxpayer
identification number is required to be shown on the form.
(B) If there is no personal representative. If there is no
personal representative for a related estate, the trustee of an
electing trust must obtain a taxpayer identification number as an
estate. The name entered on the Form SS-4 filed by the trustee A
must be the name of the trust followed by filing as an estate under
section 645." Any returns filed by the electing trust in accordance
with section 645 during the election period must be filed under the
name required to be entered on the Form SS-4 under this paragraph
and under the taxpayer identification number obtained pursuant to
this paragraph. A trustee of a QRT for which a section 645 election
will be made may choose to treat the QRT as an electing trust and
obtain a taxpayer identification number as an estate under this
paragraph and not as a trust. See �1.645-1(d)(1)(ii)(A) of this
chapter.
(iii) Taxpayer identification number to be used by a trust upon
termination of the election period. Upon the termination of the
election period, the trustee must obtain a taxpayer identification
number in the name of the new trust. If there is no personal
representative and the trustee obtained a taxpayer identification
number under paragraph (a)(4)(ii)(B) of this section for the trust
to file as an estate under section 645, the trustee must obtain a
new taxpayer identification number for the new trust. See
�1.645-1(h) of this chapter for rules regarding the treatment of an
electing trust upon termination of the election period. The trustee
must furnish to all payors of the trust a completed Form W-9 or
acceptable substitute Form W-9 signed under penalties of perjury by
the trustee providing each payor with the name of the new trust, the
TIN required to be used under this paragraph (a)(4)(iii), and the
address of the trustee.
(5) Persons treated as payors. For purposes of paragraphs (a)
(2), (3), and (4) of this section, a payor is a person described in
��1.671-4(b)(4) and 1.645-1(b)(7) of this chapter.
(6) Effective date. Paragraphs (a)(3), (4), and (5) of this
section apply on or after the date final regulations are published
in the Federal Register.
PART 602--OMB CONTROL NUMBERS UNDER THE PAPERWORK REDUCTION ACT
Par. 9. The authority citation for part 602 continues to read
as follows:
Authority: 26 U.S.C. 7805 * * *
Par. 10. In �602.101, paragraph (b) is amended by adding an
entry in numerical order to the table to read as follows: �602.101
OMB Control numbers.
* * * * *
(b) * * *
CFR part or section where Current OMB identified and described
control No.
* * * * *
1.645-1.................................1545-1578
* * * * *
Deputy Commissioner of Internal Revenue
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