Legal Question in Wills and Trusts in New York
IRS Refund to liquidated trust
When my mother died in June my sister and I became the trustees of a trust left by my father, in accordance with the terms of his will. We liquidated the trust and split the money. (It was with Merrill Lynch.)To liquidate the trust, my sister and I signed and had notarized forms sent to us by Merrill Lynch, attesting that we were the trustees. I have just received a US Treasury check made out to the trust, with my mother and a long-dead attorney, named as trustees. (My mother was the trustee.) I assume it is a tax refund, but there is no indication on the check what it's for. How do we go about cashing/depositing this check?
Thanks, in advance, for your response.
1 Answer from Attorneys
Re: IRS Refund to liquidated trust
My condolences on your loss.
You may 'endorse' (that is sign the back of the check) and deposit the check in any valid bank account, whether or not the account is related to the trust or even you!
The bank may require that you present the notarized document indicating that you are the Trustee (and therefore authorized to receive and deposit the check as you choose).
BUT: you are responsible to the Trust for the amount of the check. Because the Trust has been liquidated and the money dispersed to you and your sister, that means you must give her 1/2.
If it turns out that the check was distributed to the Trust (you) in error, then you and your sister would be responsible together for paying back the money.
The United States Department of the Treasury, Internal Revenue Service, has a toll-free 'hotline' which could be utilized by you to discover why the check was given to you. A written request would also be effective.
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