Does a grantor trust have to file Form FID-3?
Yes. Attach a statement to Form FID-3 showing the grantor’s items of income, credits and deductions. Although the grantor trust is not recognized as a separate taxable entity for income tax purposes, the grantor must keep the IRS and State of Montana informed of the income earned. If only a portion of the income earned by the trust is to be reported on the grantor’s federal Form 1040 income tax return, then both a federal Form 1041 and Montana Form FID-3 will be required annually to report that portion of the income which is taxable to the trust.
