IRS Form 8855 – In estate planning, managing taxes efficiently can make a significant difference for heirs and trustees. One powerful tool available under the Internal Revenue Code is the Section 645 election, which allows a qualified revocable trust (QRT) to be treated as part of a decedent’s estate for federal income tax purposes. This election is made using IRS Form 8855, Election to Treat a Qualified Revocable Trust as Part of an Estate. By combining the trust and estate into a single taxable entity, it simplifies reporting and can offer tax advantages. In this article, we’ll explore what Form 8855 is, who can use it, how to file, and the benefits of making this irrevocable election—drawing from official IRS guidance and trusted sources updated as of 2026.
What Is IRS Form 8855?
IRS Form 8855 is the official document used by trustees of a QRT and the executor of a related estate (if one exists) to elect Section 645 treatment. This form enables the trust to be taxed as part of the estate during the election period, rather than as a separate entity. Once filed, the election cannot be revoked, making it a permanent decision that streamlines tax filing by allowing a single Form 1041 (U.S. Income Tax Return for Estates and Trusts) or Form 1040-NR for non-resident estates. The form itself is structured into three main parts: Estate (or Filing Trust) Information, Decedent Information, and Qualified Revocable Trust Information, with spaces for multiple QRTs if applicable.
The latest revision of Form 8855 is from December 2020, but as of January 2026, no significant changes have been noted in IRS updates. For the most current version, always download from the IRS website.
What Is a Qualified Revocable Trust (QRT)?
A QRT is defined under Section 645 as any trust (or portion thereof) that was treated as owned by the decedent under Section 676 because the decedent held the power to revoke it. This power could be exercised by the decedent alone, with a non-adverse party, or with their spouse, but not solely by others. Essentially, these are revocable living trusts that become irrevocable upon the grantor’s death. To qualify for the election, the trust must have a “related estate,” meaning the decedent’s probate estate.
If no executor is appointed for the estate, the trustees can still make the election by designating a “filing trustee” from among themselves. This flexibility makes the Section 645 election accessible even in non-probate scenarios.
Purpose and Benefits of the Section 645 Election
The primary purpose of the Section 645 election is to treat the QRT as part of the estate for income tax purposes, combining them into one entity. This avoids the need for separate tax returns and EINs (Employer Identification Numbers) for each trust, simplifying administration.
Key benefits include:
- Simplified Filing: File one Form 1041 instead of multiple, reducing paperwork and potential errors.
- Fiscal Year Flexibility: The combined entity can adopt the estate’s fiscal year, potentially deferring income recognition.
- Tax Advantages: Access to estate-specific deductions, such as the charitable set-aside deduction under Section 642(c), active participation in rental real estate for passive loss rules, and holding S corporation stock for up to two years without qualifying as a shareholder.
- Election Period Duration: Starts on the decedent’s date of death and ends on the later of two years after death or six months after final estate tax determination (if Form 706 is filed).
- Separate Shares Treatment: For distributable net income (DNI), the trust and estate are treated as separate shares under Section 663(c), preserving distribution rules.
This election is particularly useful for estates with significant assets in revocable trusts, as it can minimize tax burdens and administrative costs.
Eligibility Requirements for the Section 645 Election
To be eligible:
- The trust must qualify as a QRT under IRC Section 645.
- There must be a related estate, though the election can proceed without an appointed executor by using a filing trustee.
- All trustees and the executor (if any) must agree and sign the form.
Foreign estates or trusts may also qualify, but they use Form 1040-NR. Consult IRS Regulations Section 1.645-1 for detailed rules.
How to File IRS Form 8855
Filing Form 8855 requires coordination between the executor and trustees:
- Obtain EINs: Each QRT needs a new EIN post-death (per Regulations Section 301.6109-1).
- Complete the Form: Fill out Parts I-III, including names, addresses, EINs, and signatures under penalty of perjury. Signatories agree to tax allocation, timely payments, and information sharing.
- Where to File: Mail to the IRS Service Center in Kansas City, MO (for certain states) or Ogden, UT (others).
- Amended Filings: If an executor is appointed after initial filing by trustees, file an amended Form 8855 within 90 days.
Tax software like Drake Tax or GoSystem Tax RS can assist in generating the form. Retain copies and proof of mailing.
Deadlines and Filing Requirements
The form must be filed by the due date (including extensions) of the first Form 1041 for the estate or filing trust—typically the 15th day of the 4th month after the tax year ends. Even if no income requires filing, submit if the election is desired. For 2026 filings, confirm deadlines via the latest IRS Instructions for Form 1041.
What Happens After Making the Election?
During the election period, the combined entity files as one estate, with the executor or filing trustee responsible for returns. After the period ends, the trust reverts to separate taxation. Mark “Section 645 election” on subsequent Form 1041 filings.
Common Mistakes to Avoid When Filing Form 8855
- Missing Signatures: Ensure all required parties sign.
- Incorrect EINs: Use post-death EINs for trusts.
- Late Filing: Adhere to deadlines to avoid invalidation.
- Forgetting Amendments: Update if an executor is later appointed.
Consult a tax professional or attorney for complex estates.
Conclusion: Is the Section 645 Election Right for Your Estate?
The Section 645 election via IRS Form 8855 offers a strategic way to simplify tax administration for qualified revocable trusts and estates. By treating them as one entity, it can reduce costs, defer taxes, and ease compliance. However, its irrevocability means careful consideration is essential. For personalized advice, review the official IRS form and consult experts. Download the latest Form 8855 from IRS.gov to get started.