How Do I Submit Form 56 to the IRS?

Understanding how to properly submit Form 56 to the IRS is essential for individuals assuming fiduciary responsibilities. This form notifies the IRS of a change in the responsible party managing the financial affairs of another, ensuring that tax matters are handled appropriately and legally.

Who Must Use

Form 56 is for individuals assuming fiduciary roles, such as executors, administrators, or trustees, in situations involving estates, trusts, or guardianships. These roles require managing the financial affairs of another, and the IRS mandates Form 56 to identify the correct party for tax purposes.

The form is also necessary in less traditional fiduciary scenarios. For example, when a corporation experiences a change in leadership, such as a new CEO or CFO taking responsibility for tax matters, Form 56 must be filed. Similarly, bankruptcy trustees must use this form to assume responsibility for a debtor’s tax obligations.

Guardians or conservators for minors or incapacitated individuals are also required to file Form 56. This ensures the IRS is informed of who is managing these individuals’ tax affairs, formalizing the fiduciary’s authority and promoting accountability in tax-related matters.

Gathering Documents

Submitting Form 56 requires assembling documents that establish your authority to act as a fiduciary. These might include a will, trust document, court order, or corporate resolution, depending on the situation. These foundational documents confirm your legal authority and should be accessible for submission or reference.

Additionally, gather financial records relevant to the individual or entity whose affairs you are managing, such as tax returns, financial statements, and IRS correspondence. For instance, if you’re managing an estate, review the decedent’s last filed tax return and any outstanding liabilities.

Specific scenarios may demand additional supporting documents. For guardians of minors, court appointment evidence may be required, while corporate fiduciaries might need internal documents, such as board meeting minutes, to confirm the change in responsible parties. Tailor the documentation to the fiduciary role to ensure compliance.

Filling Out the Form

Completing Form 56 requires accuracy and attention to detail to meet IRS requirements. The form is divided into sections, each addressing specific aspects of the fiduciary relationship.

Identification

The identification section establishes the identities of both the fiduciary and the individual or entity being represented. This includes providing names, addresses, and taxpayer identification numbers (TINs) for both parties. For corporate fiduciaries, the employer identification number (EIN) should be used instead of a social security number. The type of fiduciary relationship, such as executor or trustee, must also be indicated and should align with the legal documents gathered earlier.

Fiduciary Duties

This section outlines the fiduciary’s responsibilities, specifying the type of tax matters being managed, such as income, estate, or gift taxes. These duties should align with the relevant sections of the Internal Revenue Code governing the specific tax obligations. For example, if managing an estate, the fiduciary should reference estate tax provisions. The start date of the fiduciary relationship, consistent with the supporting legal documents, must also be provided.

Signatures

The fiduciary must sign and date the form, affirming the accuracy of the information and acknowledging their legal responsibilities. For corporate fiduciaries, an authorized officer must sign on the corporation’s behalf. An unsigned or improperly signed form may be rejected by the IRS, so this step is critical.

Submission Options

After completing Form 56, the next step is choosing a submission method. Many fiduciaries mail the completed form to the IRS address designated for their geographic area or the type of entity they represent. Using certified mail ensures proof of delivery, and including a cover letter summarizing key points can aid IRS personnel in the review process.

Alternatively, the IRS offers electronic submission through its e-Services platform, which can expedite processing. This method is particularly useful for large estates or corporate tax matters, as it avoids postal delays and provides immediate confirmation of receipt.

Possible Follow-Up

After submitting Form 56, fiduciaries should be prepared for potential follow-up requests from the IRS. Additional documentation or clarification may be needed, particularly in complex cases involving large estates or corporate reorganizations. Promptly addressing these inquiries is important to avoid delays or tax compliance issues.

Fiduciaries should monitor for acknowledgment from the IRS confirming receipt of the form. If no confirmation is received within four to six weeks for mailed submissions, contacting the IRS to verify the form’s status is advisable. Retain a copy of the submitted form, along with proof of mailing or electronic submission, to expedite resolution in case of disputes.

In some cases, fiduciaries may need to file another Form 56 to update or terminate their fiduciary relationship. For instance, an executor concluding the administration of an estate must notify the IRS to formally end their role. Similarly, corporate fiduciaries must update the form if another change in leadership occurs. Maintaining accurate records throughout the fiduciary period ensures compliance and minimizes risks of penalties or legal issues.