Do You Need a Tax ID Number When Selling Probate or Trust Real Estate?
If you are an executor, administrator, or trustee selling real estate as part of a probate or trust administration, the short answer is yes. In most cases, you will need a tax identification number, commonly called an EIN, to properly manage the sale and handle related financial and tax responsibilities.
An EIN is not optional paperwork. It is a key part of protecting yourself as a fiduciary and keeping estate or trust finances properly separated from personal finances.
Understanding the Difference Between an EIN and a Social Security Number
While the person was alive, their living trust was typically revocable, and all income was reported under their Social Security Number. Once the person passes away, that changes.
At death, a living trust usually becomes irrevocable. From that point forward, the trust is treated as a separate legal entity for tax purposes. The successor trustee must obtain an EIN and use it instead of the decedent’s Social Security Number when reporting income, opening accounts, and completing tax filings.
If there was no trust and the estate is going through probate, the same rule applies. Once the court appoints an executor or administrator, the estate becomes its own taxable entity and requires an EIN.
This distinction matters because continuing to use a Social Security Number after death can create reporting errors, delay tax filings, and expose the personal representative to unnecessary risk.
When an EIN Is Required During a Real Estate Sale
An EIN is commonly required in probate and trust real estate transactions for several reasons:
•Opening an estate or trust bank
•Depositing sale proceeds from escrow
•Issuing or receiving tax documents
•Filing fiduciary income tax returns
Escrow companies, banks, and accountants will typically ask for the EIN early in the process. Having it in place before listing or selling the property helps avoid last-minute delays.
How to Obtain an EIN
Once the trust becomes irrevocable or the court appoints a personal representative, you can apply for an EIN through the Internal Revenue Service.
The application is completed using IRS Form SS-4. Most people apply online, which is usually the fastest option. In many cases, the EIN is issued immediately upon completion of the application.
You can also apply by mail or fax, but those methods take longer and are rarely necessary unless there are special circumstances.
Situations Where an EIN May Not Be Required
There is one common exception. If a surviving spouse is both the sole trustee and the sole beneficiary of the trust, and all assets pass directly to that spouse, an EIN may not be required right away. In that case, the surviving spouse may continue using their own Social Security Number for tax reporting.
That said, this exception is narrow. As soon as there are multiple beneficiaries, ongoing income, or retained assets, an EIN is usually required. When in doubt, it is wise to confirm with a CPA or estate attorney.
Why Getting This Right Matters
As an executor, administrator, or trustee, you have a fiduciary duty to handle estate or trust assets correctly. Using the proper tax identification number helps:
•Keep estate finances separate from
•Ensure accurate tax reporting
•Avoid IRS correspondence or penalties
•Protect you from personal liability
This is especially important when real estate is involved, since sale proceeds are often significant and may be held for a period of time before distribution.
Final Thoughts
Applying for an EIN is usually a simple step, but it is a critical one. Getting it done early can make the entire probate or trust real estate process smoother and less stressful.
If you are unsure whether you need an EIN, when to apply, or how it fits into the sale of the property, it is worth asking before moving forward. We regularly help executors, administrators, and trustees coordinate this step alongside attorneys, accountants, and escrow, so nothing falls through the cracks.
Taking care of the details early helps protect the estate, the beneficiaries, and you.
