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You state it is an Attorney's trust account, so there is no separate Trust and there would not be a 1041 prepared for it. Attorneys, in the course of their regular business operations, maintain "pooled" trust accounts at banks, and can need to establish a segregated one for a specific matter (client issue). The interest from the segregated account would be reported to that client; pooled trust account earnings go to IOLTA (common trust maintained, such as, by the State or Bar Association). Neither activity results in a trust. Are you sure this is a Trust, or a Trust Account?
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So, obviously I do not do many trust/1041 returns. After a couple of questions, thank you for pointing me in the right direction, This is an irrevocable trust for litigation purposes. So, it is a complex trust. I am getting a copy of the trust agreement. If you think I should be aware of something else, it is appreciated.
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"This is an irrevocable trust for litigation purposes."
It's no problem. You always need to know the details. The terminology doesn't always describe the facts. That's why I asked.
I already explained how attorneys have Trust Accounts.
Let's take the example of a potentially large settlement, or a large set of plaintiffs. There can be a Trust that got established because of the large number of beneficiaries for once the trust is funded with the settlement amount, such as physical harm and/or environmental damage.
In which case,you will likely find the Attorney is the Trustee = the person named to manage everything. That means it is not the Attorney's trust account; the account belongs to the Trust. It's not even the Attorney's Trust. The point of forming this as a separate entity is because of the need to provide some protection to the parties involved, perhaps for a number of years after litigation, as well. The Attorney will operate and manage the Trust for the beneficiaries. The Trust is its own entity.
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