What happens if my trust doesn’t have a TIN when I need to sell or transfer property? – North Carolina

Short Answer

In North Carolina, a real estate closing cannot move forward without a taxpayer identification number (TIN) for the seller. If the trust has no TIN, the trustee must either use the settlor’s Social Security number for a still-revocable trust or quickly obtain an Employer Identification Number (EIN) from the IRS for an irrevocable or post‑death trust. The trustee should also provide a Certification of Trust and sign the deed to complete the transfer.

Understanding the Problem

You’re selling or transferring North Carolina real estate that’s titled in a trust. The closing attorney and realtor need a TIN to prepare the seller’s W‑9 and 1099‑S reporting. Here, the family trust created by a parent never obtained a TIN, and the realtor cannot proceed without it. The practical question is: how do you get the trust ready to close now?

Apply the Law

Under North Carolina law, trustees generally have authority to sell trust real estate unless the trust limits that power. Third parties (like closing attorneys and title companies) may rely on a Certification of Trust that confirms who the trustee is and what powers apply, instead of reviewing the entire trust. For tax reporting, the seller must furnish a TIN on a W‑9: a revocable trust that is still revocable can use the settlor’s SSN; an irrevocable or post‑death trust needs its own EIN before closing. The deed is signed by the trustee and recorded with the Register of Deeds in the county where the property is located.

Key Requirements

• Trustee authority to sell: The trustee must have power under the trust (and default law) to sell or transfer the property.
• Provide a valid TIN: Use the settlor’s SSN for a still‑revocable trust; otherwise, obtain an EIN for the trust before closing.
• Certification of Trust: Give the closing attorney a Certification of Trust showing the trustee’s identity, powers, and whether co‑trustees must act together.
• Execute and record the deed: The trustee signs the deed in a fiduciary capacity; the closing attorney records it with the Register of Deeds where the property sits.
• Follow co‑trustee rules: If multiple trustees serve, follow default decision rules or any different method set by the trust.

What the Statutes Say

• North Carolina Gen. Stat. § 36C-8-816 (Specific powers of trustee) – Includes the power to acquire, sell, and manage trust property.
• North Carolina Gen. Stat. § 36C-10-1013 (Certification of trust) – Allows trustees to provide a certification instead of the full trust.
• North Carolina Gen. Stat. § 36C-10-1012 (Protection of persons dealing with trustee) – Protects third parties who rely in good faith on the trustee’s authority.
• North Carolina Gen. Stat. § 36C-7-703 (Co‑trustees) – Sets default rules for how co‑trustees act.

Analysis

Apply the Rule to the Facts: Because the realtor cannot proceed without a TIN, the trustee must supply one on a W‑9 before closing documents can issue. If the parent’s trust is still revocable and the parent is living, the settlor’s SSN typically suffices. If the trust is irrevocable (or became irrevocable at death), the trustee should apply for an EIN immediately and then deliver a Certification of Trust and W‑9 to the closing attorney so the trustee can sign and record the deed.

Process & Timing

1. Who files: The trustee. Where: IRS (online or Form SS‑4) to obtain an EIN; then with the closing attorney and Register of Deeds in the North Carolina county where the property is located. What: IRS EIN application; IRS Form W‑9; a North Carolina Certification of Trust; trustee’s deed. When: Obtain the EIN before signing closing documents; IRS online issuance is typically immediate.
2. Provide the Certification of Trust and W‑9 to the closing attorney; coordinate any co‑trustee signatures the trust requires. Title and closing teams review and clear requirements; timing varies by county and transaction.
3. Trustee signs the deed in fiduciary capacity; closing attorney records the deed with the Register of Deeds and issues IRS Form 1099‑S to the trust’s TIN.

Exceptions & Pitfalls

• Revocable vs. irrevocable: If the trust is still revocable and the settlor is living, the SSN may be used; if not, get an EIN. Confirm the status with the trust and your tax advisor.
• Trust limits on sale: Some trusts restrict sales or require beneficiary consent. If limited, obtain needed consents or seek court instructions before signing.
• Co‑trustee action: Two co‑trustees generally must act unanimously unless the trust says otherwise. Plan signatures accordingly to avoid delays.
• No acting trustee: If there’s a vacancy or uncertainty in who serves, you may need a trust proceeding with the Clerk of Superior Court to appoint or confirm a trustee before closing.
• Document details: Use the trust’s correct legal name with the matching TIN on the W‑9, and have the deed show the trustee’s fiduciary capacity.

Talk to a Estate Planning Attorney

If you’re dealing with a trust real estate sale that’s stalled over missing tax IDs or trustee paperwork, our firm has experienced attorneys who can help you understand your options and timelines. Call us today at [919-341-7055].

Disclaimer: This article provides general information about North Carolina law based on the single question stated above. It is not legal advice for your specific situation and does not create an attorney-client relationship. Laws, procedures, and local practice can change and may vary by county. If you have a deadline, act promptly and speak with a licensed North Carolina attorney.