The short answer
A revocable living trust is a trust the grantor can amend or revoke during life, usually set up to hold title to property and pass it at death without probate, and for income tax it is a grantor trust whose assets are treated as owned by the grantor. Because section 676 treats a grantor who can revest title as the owner, the trust and the grantor are the same taxpayer for section 1031. Title held by the trustee is the grantor's title for the exchange, so property can leave from the trust and arrive in your name, or the reverse.
At a glance
| Tax status | Grantor trust, disregarded while the grantor is alive and holds the power to revoke |
|---|---|
| Same taxpayer | The grantor and the revocable trust count as one exchanger |
| How title reads | In the trustee's name, for example 'Jane Doe, Trustee of the Doe Living Trust' |
| When it changes | At the grantor's death the power to revoke ends and the trust becomes a separate taxpayer |
The trust's tax treatment comes from the grantor trust rules, not from state trust law.
Under state law the trustee holds legal title. Under section 671, when the grantor is treated as owner of a trust, the trust's items are reported on the grantor's own return. Rev. Rul. 2004-86 states the general principle, citing Rev. Rul. 85-13: a person treated as owner of a trust portion is considered to own the trust assets attributable to it.
Reporting follows suit. A trust owned by one grantor that reports under Reg. section 1.671-4(b)(2)(i)(A) can use the grantor's own identifying number, and under Reg. section 301.6109-1(a)(2) it need not obtain a separate one. The settlement agent and the qualified intermediary will usually ask for the grantor's number on the Form W-9.
None of this requires a filing to set up. A revocable trust is not a separate taxpayer while the grantor lives, so there is no trust return for the rental income and no separate Form 8824 for the trust; the grantor reports the rents, depreciation and any exchange on his or her own return, just as if the deed were in the grantor's own name.
A hypothetical: sold out of the trust, bought in the trust's name, one exchange.
Hypothetical figures: the Doe Living Trust, with Jane as trustee, sells a $900,000 rental through a qualified intermediary. Jane identifies and buys a $950,000 replacement and wants it vested in the same trust so it avoids probate.
Jane is the exchanger throughout. The exchange agreement names her, or her as trustee, and the replacement deed runs to the trustee, which is the same taxpayer that sold. She reports the exchange on her own Form 8824. Had the replacement been deeded to Jane individually, the result would be the same, and moving it into the trust afterward does not change the owner for tax purposes. Run your own numbers with your CPA.
It bites when the trust is not revocable, when a spouse's trust is mixed in, or when the grantor dies mid-exchange.
An irrevocable trust is a different matter: unless it is a grantor trust for another reason, it is its own taxpayer and must both sell and buy. Joint trusts for spouses also need care, because each spouse is treated as owner of his or her portion. The vesting questions are worked through in sell in your own name, buy in a revocable trust and the same taxpayer rule.
If the grantor dies after the sale but before the replacement closes, the trust stops being a grantor trust under the reporting rules in Reg. section 1.671-4(h), and who can finish the exchange becomes a question for the estate's advisers; see the executor's guide.
Related questions
Do I need to retitle the property before I sell?
No. Selling from the trust and buying in your own name, or the reverse, keeps the same taxpayer. Many owners still vest the replacement in the trust so the estate plan stays intact.
Can a revocable trust buy a DST interest?
It can, if the offering accepts trust investors, which you confirm in its subscription documents. For tax purposes the grantor is treated as the owner of the interest; see DST property held in an LLC or trust.
Is a trust I created for my children the same taxpayer as me?
Only if it is a grantor trust as to you under sections 673 through 679. Many irrevocable trusts for children are not, and they must exchange as their own taxpayer; see the grantor trust entry.
Sources
Checked against these publications on September 30, 2026. Rules and figures change; confirm the current version with your CPA or attorney before you act. This page is general information, not tax or legal advice.