Key Takeaways:

  • Yes, a non-resident can legally serve as a U.S. successor trustee, but doing so may trigger unintended tax consequences.
  • The trust’s tax residency status can change if a foreign person gains control, affecting how the IRS treats the trust.
  • Non-residents cannot use a deceased settlor’s SSN to apply for an EIN; instead, they must request an EIN with Form SS-4 and include proper documentation.
  • This situation is especially relevant to Boca Raton families with offshore heirs or beneficiaries.

A common estate planning scenario goes something like this: Your uncle, a U.S. citizen living in Boca Raton, Florida, creates a revocable living trust. After his passing, that trust becomes irrevocable. You, his named successor trustee, are ready to step in, but you live outside the U.S. and don’t have a Social Security Number (SSN).

Can you legally serve as a trustee? And how do you apply for a trust tax ID (EIN) without an SSN? Let’s break down what this means for the trust, the IRS, and for you as the trustee.

Consequences Of Choosing A Non-Resident Successor Trustee

Who Can Be A Successor Trustee?

There is no U.S. law that outright bars a non-resident or non-citizen from serving as a trustee. If your uncle’s trust document named you as the successor trustee and you are willing to act, you are legally authorized to do so.

However, what the law permits and what is practical or advisable can be very different things. Still, naming a non-resident trustee, even one the family trusts deeply, requires a second look when the trust becomes irrevocable.

That’s because while legal eligibility is one thing, tax consequences tied to trustee residency can create real complications. That brings us to the IRS’s two-part test: who’s in control, and where is the trust administered? Let’s look closer at why this matters.

The Real Issue: Tax Residency Of The Trust

When a trust is created in the U.S. by a U.S. citizen, it is considered a U.S. domestic trust, as long as it meets two tests under 26 U.S. Code § 7701(a)(30)(E):

  1. Court Test: A U.S. court must have primary jurisdiction over trust administration.
  2. Control Test: One or more U.S. persons must control all substantial decisions of the trust.

If you, a non-resident, are the only trustee, the trust fails the control test. The IRS would treat the trust as a foreign trust. This comes with heightened reporting requirements. It may also lead to potentially adverse tax consequences, especially if the trust earns income or holds U.S. real estate.

In short, even if the trust was born in the U.S., its tax classification can shift based on who holds the reins. And if that person isn’t a U.S. resident, the trust may lose its domestic status, opening the door to foreign trust rules and IRS scrutiny.

The next question is practical: how does a non-resident trustee handle the necessary paperwork, like getting an EIN, without a Social Security Number?

Can A Non-Resident Get An EIN For The Trust?

Every irrevocable trust needs its own Employer Identification Number (EIN). This is essentially the trust’s tax ID. When applying for an EIN using IRS Form SS-4, you’ll be asked for a “responsible party.” That’s you, the trustee.

Here’s the catch:

  • You do not need an SSN, but you cannot file Form SS-4 online without one.
  • You’ll need to submit the SS-4 form by mail or fax and write “Foreign Trustee – No SSN” in the SSN field.
  • You cannot use your deceased uncle’s SSN; doing so could trigger IRS fraud flags.

This step often delays trust administration if not planned for.

While applying for an EIN as a non-resident trustee isn’t impossible, it’s far from seamless. The process requires extra time, clear documentation, and a solid understanding of IRS expectations. And for families already navigating grief, that added friction can create stress and delays.

To put it in context, let’s explore a real-life scenario from right here in Boca Raton that illustrates the challenges and solutions.

Real-Life Example: A Boca Raton Family’s Dilemma

Let’s revisit a real-world question we received:

“My uncle, a U.S. citizen in Boca Raton, created a living trust. After his death, I became the successor trustee. But I live in Europe and don’t have an SSN. How do I get an EIN for the trust?”

In this situation, the trustee can:

  • Appoint a U.S. co-trustee, if permitted by the trust document, to satisfy the IRS control test and maintain the trust’s U.S. tax status.
  • Apply for the EIN using IRS Form SS-4 via fax, clearly indicating non-residency.
  • Consider engaging a tax advisor for any foreign trust compliance issues, including Forms 3520 and 3520-A.

This case underscores how trust administration can become tangled by geography, something many families don’t anticipate until it’s too late. The best way to avoid surprises like these is through thoughtful planning ahead of time. So, what are the upsides and downsides of naming a non-resident trustee in the first place? Let’s break it down.

Pros & Cons Of Having A Non-Resident Trustee

Before naming an overseas family member as trustee, it’s worth weighing both the practical and legal implications. While the role can be fulfilled from abroad, the IRS and many financial institutions will view a foreign trustee very differently than a U.S.-based one.

Below, we explore the potential benefits and the key challenges you should consider before finalizing that choice.

What Are The Pros?

Here are a few reasons families still choose a non-resident trustee despite the hurdles:

  • Family Continuity: Appointing a trusted loved one maintains the family’s intent and connection to the estate.
  • Global Familiarity: If assets or beneficiaries are located overseas, a non-resident trustee may offer cultural or logistical insight.
  • Cost Savings: Avoiding corporate or professional trustees can reduce long-term trust administration expenses.
  • Greater Privacy: Some families prefer to keep trust management entirely within their inner circle.

Of course, for every benefit, there are trade-offs. Choosing a non-resident trustee may align with your personal goals, but it also comes with real-world complications that can’t be overlooked.

What Are The Cons?

Despite the appeal, here are some of the most common complications:

  • Foreign Trust Classification: The trust may be deemed a foreign trust, triggering Form 3520/3520-A and potentially costly tax filings.
  • IRS Limitations: Non-residents can’t use the IRS online EIN system and face extra documentation steps.
  • Banking & Financial Hurdles: Many U.S. institutions are hesitant to work with foreign trustees due to compliance concerns.
  • Tax Withholding: Distributions to or from a foreign trust may be subject to automatic tax withholding under FATCA rules.

Before naming an overseas trustee, it’s important to understand not only who you trust, but how that choice impacts the trust’s structure and status. Fortunately, there are practical planning techniques that allow you to keep global connections without triggering IRS red flags.

Let’s look at how experienced estate-planning attorneys help families use best practices to avoid these pitfalls.

Boca Raton Probate Attorneys Utilizes Useful Practices

At Boca Raton Probate Attorneys, we regularly assist families navigating cross-border estate planning. Whether you’re appointing a trustee who lives abroad or managing a U.S. trust with global beneficiaries, we apply tested strategies. These strategies help avoid IRS pitfalls. They also preserve your family’s intent.

Here’s how we help you stay one step ahead:

Designate A U.S.-Based Co-Trustee

When permitted by the trust terms, we recommend naming a U.S. co-trustee alongside a non-resident. This keeps the trust classified as “domestic” for tax purposes, minimizing costly compliance issues.

Include Clear Successor Clauses

We draft trusts with flexible succession provisions that anticipate international appointments. That way, your trust won’t stall if a non-U.S. trustee steps in.

Keep Backup Trustees Stateside

Having a local backup trustee ensures continuity in case banking or administrative tasks hit cross-border snags.

Address IRS Reporting Requirements Early

We advise our clients on potential Form 3520 and 3520-A filing triggers so that trusts don’t fall out of compliance when a foreign trustee takes over.

Build In Trust Protector Or Advisor Roles

In complex cases, we may recommend a U.S.-based trust protector who can override, replace, or guide a foreign trustee without full court involvement.

Regularly Review & Update Trust Documents

How To Choose A Successor TrusteeAs family circumstances and tax laws evolve, we conduct periodic trust reviews to ensure your plan still works, no matter where your loved ones live.

These practices are part of our commitment to safeguarding your legacy while ensuring your estate plan runs smoothly, even across borders. Next, we invite you to explore how we can support your trust administration needs more personally.

If you’re named as a trustee but live outside the U.S., you may face unique legal challenges. If you’re setting up a trust and want to ensure it’s future-proof, careful planning is essential. Schedule a consultation with Boca Raton Probate Attorneys. We’ll walk you through your responsibilities, tax implications, and the right next steps to protect your family’s legacy.