Disclaimer: This article is for informational purposes only and does not constitute legal advice. Consult a qualified attorney or tax professional for guidance on your specific situation.
Detailed Answer
When a person passes away with assets to administer, the appointed executor (also called a personal representative) must obtain an Employer Identification Number (EIN) to handle estate finances. An EIN acts like a Social Security number for the estate. You need it to open bank accounts, file tax returns, and settle debts.
Step 1: Secure Letters Testamentary
First, file the will and a death certificate with the New Jersey Surrogate’s Court in the county where the decedent lived. Once the court issues letters testamentary (proof of your authority), you can apply for an EIN.
See Surrogate’s Court info: www.njcourts.gov/courts/surrogate.html.
Step 2: Complete IRS Form SS-4
Use IRS Form SS-4 to request an EIN for the estate. You can apply:
• Online (instant issuance): Apply for an EIN Online
• By mail: Send the completed SS-4 to the IRS address listed in the form instructions.
• By fax: Fax the SS-4 to the IRS fax number in the instructions.
When filling out Form SS-4, provide the decedent’s name, Social Security number, date of death, and your name as executor. Be precise to avoid processing delays.
Legal Basis: Under federal law, fiduciaries must obtain identifying numbers for estates. See 26 U.S.C. § 6109 (govinfo.gov).
Step 3: Use the EIN
Once issued, use the estate’s EIN to open a bank account and file the final individual income tax return (Form 1040) and the estate income tax return (Form 1041). Keep the number on file for any future filings or distributions.
Helpful Hints
- Apply for the EIN as soon as you receive letters testamentary.
- Have the decedent’s SSN and death certificate on hand before starting Form SS-4.
- Keep copies of all filings, including Form SS-4 and proof of submission.
- Use the estate’s EIN exclusively for estate transactions to avoid confusion with personal finances.
- If the estate holds real estate or investments, notify financial institutions of the new EIN promptly.