After a grantor dies, a revocable trust becomes irrevocable and must be wound down. Get an EIN for the trust, handle brokerage accounts with step-up in basis, file the trust's income tax return, issue K-1s to beneficiaries, then sell real estate and distribute proceeds.
How to close out a revocable trust. If you created a revocable trust during your lifetime, when you're gone, it's common for that trust to become a permanent trust or irrevocable so that it can be completely wound down and closed out. This will all happen outside of any court proceeding. And here is how you do that. Let's say the assets that you had in that trust were a home and an investment account. First thing you're going to need to do is get a tax ID number or an EIN number for the trust. If you Google that, that is easily done online. If the brokerage account was titled in the name of the trust or the trust was the beneficiary of that account, the brokerage will issue 1099s to the trust and send the money to the trust. Those investments will receive a step-up in basis on your death, so your beneficiaries will not have to pay capital gains on those investments. The trust itself will have to file an income tax return, and when the money is paid to the beneficiaries, the trust will issue K-1 statements to them. If the plan is to sell the house and distribute the proceeds to
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