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Department of the Treasury
Internal Revenue Service
Instructions for Form

706-GS(T)

(Rev. November 2020)
Generation-Skipping Transfer Tax Return for Terminations

Section references are to the Internal Revenue termination occurs. If the due date falls Examples of such arrangements are
Code unless otherwise noted. on a Saturday, Sunday, or legal holiday, insurance and annuity contracts,
file on the next business day. arrangements involving life estates and
Future Developments remainders, and estates for years.
If you are not able to file the return by In general, a transfer of property in
For the latest information about the due date, you may request an which the identity of the transferee is
developments related to Form extension of time to file by filing Form conditioned on the occurrence of an
706-GS(T) and its instructions, such as 7004, Application for Automatic event is a transfer in trust. This rule
legislation enacted after they were Extension of Time To File Certain does not apply to a testamentary trust,
published, go to IRS.gov/Form706GST. Business Income Tax, Information, and however, if the event is to occur within 6
Other Returns. The extension is months of the transferor's date of death.
What’s New automatic, so you do not have to sign
the form or provide a reason for your Nonexplicit trusts do not include
GST exemption increased. The request. You must file Form 7004 on or decedents' estates.
generation skipping tax (GST) before the regular due date of Form In the case of a nonexplicit trust, the
exemption amount increased for 2020. 706-GS(T). See Form 7004 for more person in actual or constructive
See Numerator. GST exemption., later. information. possession of the property involved is
considered the trustee and is liable for
Reminder Where To File filing Form 706-GS(T).
For federal tax purposes, marriages of File Form 706-GS(T) at the following If you are filing this return for a
couples of the same sex are treated the address. nonexplicit trust, see the instructions for
same as marriages of couples of the
line 1b.
opposite sex. The term “spouse” Department of the Treasury
includes an individual married to a Internal Revenue Service Center Separate trusts. You must treat as
person of the same sex. However, Kansas City, MO 64999 separate trusts:
individuals who have entered into a • Portions of a trust that are attributable
registered domestic partnership, civil If using a private delivery service, send to transfers from different transferors,
union, or other similar relationship that Form 706-GS(T) to: and
isn’t considered a marriage under state • Substantially separate and
law aren’t considered married for Internal Revenue Service independent shares of different
federal tax purposes. If you believe the 333 W. Pershing Road beneficiaries in a trust.
new law may affect your estate or gift Kansas City, MO 64108 If you are the trustee for separate
tax liability or filing requirement, please trusts as described above, you must file
continue to monitor IRS.gov for a single Form 706-GS(T) but separate
additional guidance. Amending Form 706-GS(T)
Schedules A for each separate trust, as
The address for filing an amended Form that term is used here.
General Instructions 706-GS(T) is:
Terminations Subject to
Purpose of Form Internal Revenue Service Center GST Tax
Form 706-GS(T) is used by a trustee to Attn: E&G, Stop 824G A termination may occur by reason of
figure and report the tax due from 7940 Kentucky Drive death, lapse of time, release of a power,
certain trust terminations that are Florence, KY 41042-2915 or any other means.
subject to the generation-skipping In general, all taxable terminations
transfer (GST) tax. If using a private delivery service, send
amended Form 706-GS(T) to: are subject to the GST tax. A taxable
termination is the conclusion of an
Who Must File interest in property held in trust unless:
Internal Revenue Service Center
In general, the trustee of any trust that Attn: E&G, Stop 824G • Immediately after the termination, a
has a taxable termination (defined 7940 Kentucky Drive non-skip person has an interest in the
below) must file Form 706-GS(T) for the Florence, KY 41042-2915 property, or
tax year in which the termination • At no time after the termination may a
occurred. distribution be made from the trust to a
Trusts skip person.
When To File Nonexplicit trusts. An arrangement
Generally, the trustee must file Form that has substantially the same effect as Exceptions
706-GS(T) by April 15 of the year a trust will be treated as a trust even Irrevocable trusts. Except as
following the calendar year in which the though it is not an explicit trust. described under Additions to

Oct 06, 2020 Cat. No. 10829R

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irrevocable trusts below, the GST tax        Transition Rule for Revocable               tax may not apply. See Regulations 
does not apply to any termination of an      Trusts                                      section 26.2601-1(b)(3) for a definition 
interest in a trust that was irrevocable on                                              of the term “mental disability” and 
September 25, 1985. Any trust in             The GST tax will not apply to any           additional details.
existence on September 25, 1985, will        termination of an interest in a revocable 
be considered irrevocable unless:            trust, provided:                            Exceptions to Additions Rule
                                             • The trust was executed before             Do not treat as an addition to a trust any 
   1. On September 25, 1985, the             October 22, 1986;                           addition that is made pursuant to an 
settlor held a power with respect to such    • The trust as it existed on October 21,    instrument or arrangement that is 
trust that would have caused the value       1986, was not amended after October         covered by the transition rules 
of the trust to be included in the settlor's 21, 1986, in any way that created or        discussed above under Transition Rule 
gross estate for federal estate tax          increased the amount of a                   for Revocable Trusts and Transition 
purposes by reason of section 2038           generation-skipping transfer;               Rule in Case of Mental Disability. This 
(regarding revocable transfers) if the       • Except as provided in Exceptions to       also applies to inter vivos transfers if the 
settlor had died on September 25, 1985;      Additions Rule, later, no additions were    same property would have been added 
or                                           made to the trust; and                      to the trust by such an instrument. For 
   2. Regarding a policy of life             • The settlor died before January 1,        examples illustrating this rule, see 
insurance that is treated as a trust under   1987.                                       Regulations section 26.2601-1(b)(5)(ii).
section 2652(b), the insured possessed 
an incident of ownership on September          A revocable trust is any trust that on 
25, 1985, that would have caused the         October 22, 1986, was not an                Definitions
insurance proceeds to be included in         irrevocable trust, as defined previously,   Skip Persons
the insured's gross estate for federal       and would not have been an irrevocable 
estate tax purposes if the insured had       trust had it been created before            For termination purposes, skip person 
died on September 25, 1985.                  September 25, 1985.                         means a trust beneficiary who is either:
                                                                                           1. A natural person assigned to a 
   For more information, see                   The instructions under Trusts             generation that is two or more 
Regulations section 26.2601-1(b)(i) and      containing qualified terminable interest    generations below the settlor's 
(ii).                                        property, previously, apply also to         generation, or
                                             revocable trusts covered by these 
Trusts containing qualified termina-         transition rules.                             2. A trust that meets either of the 
ble interest property.   Irrevocable                                                     following conditions:
trusts in existence on September 25,         Amendments to revocable trusts.        An     a. All interests in the trust are held 
1985, that hold qualified terminable         amendment to a revocable trust in           by skip persons; or
interest property (QTIP) (as defined in      existence on October 21, 1986, will not 
section 2056(b)(7)) as a result of an        be considered to result in the creation       b. No person holds an interest in the 
election under section 2056(b)(7) or         of, or an increase in the amount of, a      trust, and at no time after the transfer to 
2523(f), are treated for purposes of the     generation-skipping transfer where:         the trust may a distribution be made to a 
GST tax as if the QTIP election had not      • The amendment is administrative or        non-skip person.
been made. Thus, transfers from such a       clarifying in nature, and it only           Interest
trust will not be subject to the GST tax.    incidentally increases the amount 
                                             transferred to a skip person (defined       A person holds an interest in the trust if, 
Additions to irrevocable trusts.     If an   below), or                                  at the time the determination is made, 
addition has been made after                 • It is designed to perfect a marital or    the person:
September 25, 1985, to an irrevocable        charitable deduction for an existing          1. Has a current right to receive 
trust, the termination of any interest in    transfer, and it only incidentally          income or corpus from the trust;
the trust may be subject in part to the      increases the amount transferred to a         2. Is a permissible current recipient 
GST tax. Additions include constructive      skip person (defined later).                of income or corpus from the trust (other 
additions described in Regulations           See Regulations section 26.2601-1(b)        than charitable entities); or
section 26.2601-1(b)(1)(v).                  (2)(vii) for examples demonstrating 
                                                                                           3. Is a charitable or other entity 
Medical and educational exclusion.           these rules.
                                                                                         described in section 2055(a) and the 
If all of the property to which the          Additions to revocable trusts.     If an    trust is a charitable remainder annuity 
termination applied has been distributed     addition (including a constructive          trust, a charitable remainder unitrust, or 
and used for medical or educational          addition) to a revocable trust is made      a pooled income fund.
expenses of the transferee such that if      after October 21, 1986, and before the 
the transfer had been made inter vivos       death of the settlor, all subsequent          Any interest that is created primarily 
by an individual, it would not have been     terminations of interests in the trust will to postpone or avoid the GST tax is 
subject to gift tax by reason of the         be subject to the GST tax if the other      disregarded.
medical and educational exclusion, then      requirements of taxability are met. For     Non-Skip Person
the termination is not a                     settlors dying before January 1, 1987,      A non-skip person is any person who is 
generation-skipping transfer, and you        any addition made to a revocable trust      not a skip person.
do not have to file this form to report the  after the death of the settlor will be 
termination.                                 treated as made to an irrevocable trust.    Generation Assignment
                                             Transition Rule in Case of                  A generation is determined along family 
                                                                                         lines as follows.
                                             Mental Disability
                                                                                           1. Where the beneficiary is a lineal 
                                             If the settlor was under a mental 
                                                                                         descendant of a grandparent of the 
                                             disability on October 22, 1986, the GST 

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transferor (for example, the donor's Generation Assignment Where after July 18, 2005. See Regulations
cousin, niece, nephew, etc.), the Intervening Parent Is Deceased section 26.2651-1(a)(2)(iii).
number of generations between the
transferor and the descendant is If you made a gift or bequest to your Multiple Skips
determined by subtracting the number grandchild and at the time you made the If after a generation-skipping transfer,
of generations between the grandparent gift or bequest, the grandchild's parent the property transferred is held in trust,
and the transferor from the number of (who is your or your spouse's or your then for the purpose of determining the
generations between the grandparent former spouse's child) is deceased, taxability of subsequent transfers from
and the descendant. then for purposes of generation the trust involving that property, the
assignment, your grandchild will be transferor of the property is assigned to
2. Where the beneficiary is the lineal considered to be your child rather than the first generation above the highest
descendant of a grandparent of a your grandchild. Your grandchild's generation of any person who has an
spouse (or former spouse) of the children will be treated as your interest in the trust immediately after the
transferor, the number of generations grandchildren rather than your initial transfer.
between the transferor and the great-grandchildren.
descendant is determined by
subtracting the number of generations This rule governs generation Penalties and Interest
between the grandparent and the assignment of lineal descendants below Section 6651 provides for penalties for
spouse (or former spouse) from the the level of grandchild. For example, if both late filing and for late payment
number of generations between the your grandchild is deceased, your unless there is reasonable cause for the
grandparent and the descendant. great-grandchildren who are lineal delay. The law also provides penalties
3. For this purpose, a relationship descendants of the deceased for willful attempts to evade payment of
by adoption is considered a blood grandchild are considered your tax.
relationship. A relationship by half-blood grandchildren for purposes of the GST
is considered a relationship by whole tax. Section 6662 provides penalties for
underpayments of GST taxes due to
blood. This rule also applies to other lineal negligence, intentional disregard of
4. The spouse or former spouse of a descendants. For example, if property is rules and regulations, or a substantial or
transferor or lineal descendant is transferred to an individual who is a gross valuation understatement. A
considered to belong to the same descendant of a parent of the transferor, substantial valuation understatement
generation as the transferor or lineal and that individual's parent (who is a occurs when the reported value of
descendant, as the case may be. lineal descendant of the parent of the property on Form 706-GS(T) is 65% or
transferor) is deceased at the time the less of the actual value of the property.
A person who is not assigned to a transfer is subject to gift or estate tax, A gross valuation understatement
generation according to the rules above then for purposes of generation occurs when the reported value of the
is assigned to a generation based on his assignment, the individual is treated as property listed on Form 706-GS(T) is
or her birth date as follows. if he or she is a member of the 40% or less of the actual value of the
1. A person who was born not more generation that is one generation below property. No penalty will be assessed if
than 12 / years after the transferor is in 1 2 the lower of: the underpayment of GST tax,
the transferor's generation. • The transferor's generation; or attributable to substantial or gross
2. A person born more than 12 /1 2 • The generation assignment of the valuation understatement, does not
years, but not more than 37 / years, 1 2 youngest living ancestor of the exceed $5,000.
after the transferor is in the first individual, who is also a descendant of
generation younger than the transferor. the parent of the transferor. Interest will be charged on taxes not
paid by their due date, even if an
3. Similar rules apply for a new The same rules apply to the extension of time to file is granted.
generation every 25 years. generation assignment of any Interest is also charged on any additions
descendant of the individual.
If more than one of the rules for to tax imposed by section 6651 from the
assigning generations applies to a This rule does not apply to a transfer due date of the return (including any
beneficiary, the beneficiary is generally to an individual who is not a lineal extensions) until the addition to tax is
assigned to the youngest of the descendant of the transferor if the paid.
generations that apply. transferor has any living lineal Return preparer. The Small Business
descendants. and Work Opportunity Act of 2007
If an entity such as a partnership, extended return preparer penalties to all
corporation, trust, or estate has an If any transfer of property to a trust
return preparers. Return preparers who
interest in property, each individual who would have been a direct skip except for prepare any return or claim for refund
has a beneficial interest in the entity (for this generation assignment rule, then
that reflects an understatement of tax
example, partners, shareholders, and the rule also applies to transfers from liability due to an unreasonable position
beneficiaries) is treated as having an the trust attributable to such property.
are subject to a penalty equal to the
interest in the property. The individual is Ninety-day rule. For purposes of greater of $1,000 or 50% of the income
then assigned to a generation using the determining if an individual's parent is derived (or to be derived) for the
rules described above. deceased at the time of a testamentary preparation of each such return. Return
transfer, an individual's parent who dies preparers who prepare a return or claim
Government entities and certain no later than 90 days after a transfer for refund that reflects an
charitable organizations are assigned to occurring by reason of the death of the understatement of tax liability due to
the transferor's generation. transferor is treated as having willful or reckless conduct are subject to
Terminations in their favor will never be predeceased the transferor. The 90-day a penalty of $5,000 or 75% of the
generation-skipping transfers. rule applies to transfers occurring on or income derived (or income to be

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derived), whichever is greater, for the You can also apply for an EIN at Also, if you are reporting separate
preparation of each such return. See IRS.gov/Businesses. trusts, defined above, on this Form
sections 6694(a) and 6694(b), the 706-GS(T), explain why you are treating
related regulations, and Ann. 2009-15, Part II—Trust Information parts of the trust as separate trusts.
2009-11 I.R.B. 687 (available at
IRS.gov/pub/irs-irbs/irb09-11.pdf) for Line 4 Line 3
more information. Whenever property is transferred into a You may elect alternate valuation under
pre-existing trust, the inclusion ratio section 2032 for all terminations in the
Signature must be refigured. See Multiple same trust that occurred at the same
Form 706-GS(T) must be signed by the transfers, later, for the rule on how to time as and as a result of the death of
trustee or by an authorized refigure the inclusion ratio. an individual. If you elect alternate
valuation, you must use it to value all
representative. Line 7 property included in those terminations.
If you fill in your own return, leave the If a qualified terminable interest property
You may not elect alternate valuation
Paid Preparer Use Only space blank. If deduction was taken by the settlor as
unless the election will decrease both
someone prepares your return and does donor spouse or by the executor of a
the total value of the property interests
not charge you, that person should not deceased settlor's estate for the transfer
that were subject to the termination and
sign the return. of any property into this trust, the donor
the total net GST tax due after the
spouse or the executor, as the case
allowable credit.
Generally, anyone who is paid to may be, may have made an election at
prepare the return must sign the return that time to treat such transfer for the Check the box on line 3 of all the
in the space provided and fill in the Paid purpose of the GST tax as if it was not applicable Schedules A if you elect
Preparer Use Only area. See section qualified terminable interest property. In alternate valuation. Once made, the
7701(a)(36)(B) for exceptions. this case, you must refer to the gift tax election cannot be revoked. You may
In addition to signing and completing return (Form 709, United States Gift make the election on a late filed Form
the required information, the paid (and Generation-Skipping Transfer) Tax 706-GS(T), provided it is not filed later
preparer must give a copy of the Return) of the donor spouse or the than 1 year after the due date (including
completed return to the taxpayer. deceased settlor's estate tax return extensions).
(Form 706, United States Estate (and If you elect alternate valuation, value
Note. A paid preparer may sign original Generation-Skipping Transfer) Tax the property interest that has been
or amended returns by rubber stamp, Return) for the information needed to terminated as follows.
mechanical device, or computer figure the inclusion ratio.
software program. 1. Any property distributed or
Schedule A (Lines 1–4) otherwise disposed of or separated from
the trust within 6 months after the
Specific Instructions Note. If you need more than one termination is valued on the date of
Schedule A, make copies before distribution or other disposition. Value
Complete Form 706-GS(T) in the completing it. Also, make a copy of the property on the date it ceases to
following order: Parts I and II, Schedule B for each Schedule A you form a part of the trust; that is, on the
Schedule A (through line 4), will file. If you need additional space to date the title passes as a result of its
Schedule B, Schedule A (lines 5 provide all the required information for distribution or other disposition.
through 10), Part III. any given schedule, attach a separate 2. Any property not distributed or
sheet of the same size to that schedule.
Part I—General otherwise disposed of within 6 months
Combine on a single Schedule A all following the termination is valued on
Information terminations from a single trust that the date 6 months after the termination.
Line 1b. Trust's Employer have the same inclusion ratio (as 3. Any property or interest that is
discussed later). However, you must affected by mere lapse of time is valued
Identification Number complete a separate Schedule A for as of the time of termination. However,
All trusts filing Form 706-GS(T) must each terminating interest that has a you may change this date of termination
have an employer identification number different inclusion ratio. Number each value to the value as of the date of
(EIN). A nonexplicit trust, defined Schedule A consecutively in the space distribution or other disposition to
above, must have an EIN that is provided at the top. account for any change that is not due
separate from any other entity's EIN and
that will be used only by the entity in its Line 2 to mere lapse of time.
capacity as the nonexplicit trust. For the purposes of line 2, termination If the alternate valuation date falls
means the conclusion (for example, by after the initial due date of the return,
A trust or nonexplicit trust that does death, lapse of time, or release of you must request an extension to file on
not have an EIN should apply for one on power, etc.) of an interest in property Form 7004. The extension is automatic,
Form SS-4, Application for Employer held in trust unless: so you do not have to sign the form or
Identification Number. You can get • Immediately after the termination, a provide a reason for your request. See
Form SS-4, and other IRS tax forms and non-skip person has an interest in such Form 7004 for more information.
publications, by visiting IRS.gov. property; or
Send Form SS-4 to the address • At no time after the termination is it Line 4
listed under Where To File. If you do not possible for a distribution (including Terminations of interests in trusts to
receive the EIN by the due date for the distributions on termination) to be made which additions have been made.
706-GS(T), write “Applied for” on from the trust to a skip person. As described earlier, when an addition
line 1b. is made to an irrevocable trust after

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September 25, 1985, only the portion of and lot, etc. For rural property, report Schedule B(1)—General Trust
the trust resulting from the addition is the township, range, landmarks, etc. Debts, Expenses, and Taxes
subject to the GST tax. For terminations,
this portion is the product of the Stocks and bonds. For stocks, Report here only those expenses
allocation fraction and the value of the give: related to the entire trust. Examples of
property subject to the termination • Number of shares; such expenses are trustee's fees,
(including accumulated income and • Whether common or preferred; administrative expenses, financial
appreciation on that property). • Issue; advisor's fees, and accounting fees.
• Par value where needed for
Column a. Item no. Assign an item
The allocation fraction is a fraction, valuation;
number to each separate expense.
the numerator of which is the value of • Price per share;
These will not necessarily correspond
the addition as of the date it was made • Exact name of corporation;
with the item numbers on Schedule A.
(regardless of whether it was subject to • Principal exchange upon which sold,
gift or estate tax). The denominator of if listed on an exchange; and Column b. Description. List the
the fraction is the fair market value of • CUSIP number. names and addresses of persons to
the entire trust immediately after the whom the expenses are payable and
addition, less any amount of expenses, For bonds, give:
indebtedness, or taxes that would be • Quantity and denomination; describe the nature of the expenses.
allowable as a deduction under section • Name of obligor; Column c. Amount. Enter here the
2053. • Date of maturity; entire amount of the expense for the tax
• Principal exchange, if listed on an year for which the return is being filed.
When there is more than one exchange;
addition, the allocation fraction must be • Interest rate; Line 2. Figure the percentage of
revised after each addition. The • Interest due date; and expense to allocate to the property
numerator of the revised fraction is the • CUSIP number. involved in the termination as follows.
sum of: 1. Divide the value of the interest
• The value of the portion of the trust If the stock or bond is unlisted, show
subject to the GST tax immediately the company's principal business office. that has been terminated by the total
value of the trust at the time of the
before the last addition, and The CUSIP (Committee on Uniform termination; and
• The amount of the latest addition. Security Identification Procedure)
The denominator of the revised number is a nine-digit number assigned 2. Multiply the result by a fraction,
fraction is the total value of the entire to all stocks and bonds traded on major the numerator of which is the number of
trust immediately after the latest exchanges and many unlisted days in the year through the date of the
addition. securities. Usually, the CUSIP number termination, and the denominator of
is printed on the face of the stock which is the total number of days in the
If the addition results from a certificate. If the CUSIP number is not year (or, if the entire trust was
generation-skipping transfer, reduce printed on the certificate, it may be terminated during the year, the total
both the numerator and denominator by obtained through the company's number of days the trust was in
the amount of any GST tax imposed on transfer agent. existence during the year).
the transfer and recovered from the
trust. Other personal property. Any If there is more than one termination
Round off the allocation fraction to interest in personal property involved in during the year, you must reduce the
five decimal places (for example, a termination must be described in total expense used in the allocation by
“.00123”). enough detail that the IRS can value it. the expense allocated to the prior
terminations. For example, assume that
Column a. Item no. Identify by Column d. Valuation date. Unless the total administrative expense for the
separate item number all property in you elected alternate valuation by year was $1,000 and $300 was
which an interest has terminated during checking the box on line 3 of allocated to the first termination. The
the tax year. You may combine under Schedule A, the valuation date should expense allocated to the second
the same item number all property that be the same as the termination date. termination would be a percentage of
has the same termination date, Column e. Value. Reduce the value of $700, not of the entire $1,000.
valuation date, and unit value, such as any property being reported on Schedule B(2)—Specific
stocks or bonds. Otherwise, assign a Schedule A by the amount of any
separate item number to each article of consideration provided by the skip Termination-Related Debts,
property. person. Expenses, and Taxes
Column b. Description of property. Explain how the values reported in Report here only those expenses
Describe each article of property column e were figured and attach related solely to the interest that has
assigned an item number as follows. copies of any appraisals. terminated. Examples of these
expenses are property tax on real
Real estate. Describe the real Schedules B(1) and B(2) estate, the cost of selling property, or
estate in enough detail so that the IRS attorney's fees for defending the title to
To figure the taxable amount for a
can easily locate it for inspection and property.
taxable termination, you may deduct
valuation. For each parcel of real estate, Column a. Item no. Assign an item
expenses similar to those deductible
report the area and, if the parcel is number to each separate expense. This
under section 2053 from the value of the
improved, describe the improvements. will not necessarily correspond with the
property subject to the termination.
For city or town property, report the item numbers on Schedule A.
street number, ward, subdivision, block
Column b. Description. List the
names and addresses of persons to

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whom the expenses are payable and Year of Transfer GST If the allocation of the exemption to
describe the nature of the expense. List Exemption an inter vivos transfer is not made on a
the item number(s) from Schedule A to 1999 . . . . . . . . . . . . . $1,010,000 timely filed gift tax return and is not
which the expense relates. 2000 . . . . . . . . . . . . . $1,030,000 deemed made under section 2632(b)
(1), the value for purposes of the
Column c. Amount. If the expense 2001 . . . . . . . . . . . . . $1,060,000
applicable fraction is the value of the
relates to more property than that 2002 . . . . . . . . . . . . . $1,100,000 property transferred at the time the
involved in the termination but less than 2003 . . . . . . . . . . . . . $1,120,000 allocation under section 2632(a) is filed
the entire trust, enter in column c only 2004 and 2005. . . . . . . $1,500,000 with the IRS.
the amount attributable to the property 2006, 2007, and 2008 . . $2,000,000 The value of a testamentary transfer
involved in the termination. Determine
2009 . . . . . . . . . . . . . $3,500,000
this amount by multiplying the total is generally the estate tax value.
expense times a fraction. The 2010 and 2011. . . . . . . $5,000,000
For qualified terminable interest
numerator of the fraction is the value of 2012 . . . . . . . . . . . . . $5,120,000 property (QTIP) that is included in the
the property involved in the termination 2013 . . . . . . . . . . . . . $5,250,000 estate of the surviving spouse of the
and to which the expense relates. The 2014 . . . . . . . . . . . . . $5,340,000 settlor because of section 2044, if the
denominator is the total value of the 2015 . . . . . . . . . . . . . $5,430,000 surviving spouse is considered the
property to which the expense relates. 2016 . . . . . . . . . . . . . $5,450,000 transferor under section 2652(a) for
2017 . . . . . . . . . . . . . $5,490,000 GST purposes, the value is the estate
Schedule A (Lines 5–10) 2018 . . . . . . . . . . . . . $11,180,000 tax value in the estate of the surviving
Line 7. Inclusion Ratio 2019 . . . . . . . . . . . . . $11,400,000 spouse.
2020 . . . . . . . . . . . . . $11,580,000 A special QTIP election allows
The trustee must figure the inclusion property for which a QTIP election was
ratio for every termination. All made for estate or gift tax purposes to
terminations, or any parts of a single be treated for GST tax purposes as if
termination, that have different inclusion A valid Deceased Spousal
the QTIP election had not been made. If
ratios must be shown on separate ! Unused Exclusion Amount the special QTIP election has been
Schedules A. Identify the separate CAUTION ("DSUE" or portability) election
trusts by Schedule A number when by an executor of a deceased spouse's made, the predeceased settlor spouse
showing your inclusion ratio calculation. estate does not apply to or impact GST is the transferor and the value is that
tax exemption. spouse's estate or gift tax value under
The inclusion ratio is the excess of 1 the rules described above. The settlor
over the applicable fraction determined For existing trusts, transferors may spouse or the executor of the
for the trust in which the termination allocate the additional GST exemption predeceased settlor spouse's estate
occurred. amount attributable to indexing must have made the special QTIP
adjustments if they otherwise qualify election.
Applicable fraction. The applicable under the existing rules for late Transfers subject to an estate tax in-
fraction is a fraction, the numerator of allocations. For more information, see clusion period. If a transferor made an
which is the amount of the GST section 2632 and Multiple transfers, inter vivos transfer, and the property
exemption. The denominator of the later. transferred would have been includible
fraction is:
Once made, allocations are in the transferor's estate if he or she had
1. The value of the property irrevocable. died immediately after the transfer
transferred to the trust, minus
Allocation of the GST exemption is (other than by reason of the transferor
2. The sum of: made by the settlor on Form 709 or on dying within 3 years of making the gift),
a. Any federal estate tax or state Form 706 by the executor of the settlor's for purposes of determining the
death tax actually recovered from the estate. Therefore, you should obtain inclusion ratio, an allocation of GST
trust attributable to the property, and information regarding the allocation of exemption will only become effective at
b. Any charitable deduction allowed the exemption to this trust from the the close of the estate tax inclusion
under section 2055 or 2522 with respect settlor or the executor of the settlor's period (ETIP).
to the property. estate, as applicable. The value of the property for the
Round the applicable fraction to at If the settlor's entire GST exemption purpose of figuring the inclusion ratio is
least the nearest one-thousandth (for is not allocated by the due date the estate tax value if the property is
example, “.001”). (including extensions) of the settlor's includible in the transferor's gross
estate tax return, the exemption is estate. Otherwise, the property is valued
Numerator. GST exemption. Every automatically allocated to the settlor's at the close of the ETIP, provided that
individual settlor is allowed a lifetime generation-skipping transfers under the the GST exemption is allocated on a
GST exemption against property that rules of section 2632. timely filed gift tax return for the
the individual has transferred. For calendar year in which the ETIP closes.
generation-skipping transfers made Denominator. Valuation of trust as-
through 1998, the amount of the sets. In general, for an inter vivos The ETIP closes at the earliest of:
exemption was $1 million. The GST transfer, you should use the gift tax • The time the transferred property
exemption amounts for 1999 through value in the denominator of the would no longer be includible in the
2020 are as follows: applicable fraction as long as the settlor's estate,
allocation of the GST exemption was • The date of a generation-skipping
made on a timely filed gift tax return or transfer of the property, or
was deemed made under section • The date of death of the settlor.
2632(b)(1).

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If the allocation is not made on a 1. The exemption allocated to the
timely filed gift tax return, the property is trust, and After December 31, 2005, 46%
but before January 1,
valued at the time of the late allocation. 2. Interest on the exemption 2007 . . . . . . . . . . . . . .
Multiple transfers. When a transfer is determined at the interest rate used to
made to a pre-existing trust, the figure the estate or gift deduction for the After December 31, 2006, 45%
applicable fraction must be refigured. charitable lead annuity and for the but before January 1,
The numerator of the new fraction is the actual period of the charitable lead 2010 . . . . . . . . . . . . . .
sum of: annuity.
After December 31, 2009, 0%
1. The exemption allocated to the In the case of a late allocation, the but before January 1,
current transfer, and amount of interest accrued prior to the 2011 . . . . . . . . . . . . . .
2. The nontax portion of the trust date of allocation is zero.
After December 31, 2010, 35%
immediately before the current transfer Line 8 but before January 1,
(the product of the applicable fraction
and the value of all the property in the Enter, from the table below, the 2013 . . . . . . . . . . . . . .
trust immediately before the current applicable tax rate at the time the
transfer). generation-skipping transfer occurred. After December 31, 40%
2012 . . . . . . . . . . . . . .
The denominator of the new fraction Table of Maximum Tax Rates
is the sum of: Part III—Tax Computation
1. The value of the current transfer The
If the generation-skipping maximum
(minus any federal estate tax or state Line 9b
transfer occurred tax rate is
death tax actually paid by the trust If you have more than six Schedules A
attributable to such property and any After December 31, 2002, 49% attached to this form, enter the total
charitable deduction allowed for such but before January 1, GST tax from all Schedules A in excess
property), and 2004 . . . . . . . . . . . . . . of six.
2. The value (determined under the Line 12
rules described above) of all property in After December 31, 2003, 48%
the trust immediately before the current but before January 1, Make checks payable to the “United
transfer. 2005 . . . . . . . . . . . . . . States Treasury.” Please write the trust's
EIN, the year of the transfer, and “Form
To figure the inclusion ratio, use only After December 31, 2004, 47% 706-GS(T)” on the check to ensure
the value of the total additions made to but before January 1, posting to the proper account. Enclose,
the trust after October 22, 1986. 2006 . . . . . . . . . . . . . . but do not attach, the payment with
Form 706-GS(T).
Charitable lead annuity trusts. For
termination of an interest in a charitable
lead annuity trust, the numerator of the
applicable fraction is the adjusted GST No checks of $100 million or more
exemption as defined below. The accepted. The IRS cannot accept a
denominator is the value of the trust single check (including a cashier's
immediately after the termination of the check) for amounts of $100,000,000
charitable lead annuity interest. ($100 million) or more. If you're sending
$100 million or more by check, you'll
The adjusted GST exemption is the
need to spread the payments over two
sum of:
or more checks, with each check made
out for an amount less than $100
million. The $100 million or more
amount limit does not apply to other
methods of payment (such as electronic
payments), so please consider paying
by means other than check.

Paperwork Reduction Act Notice. We ask for the information on this form to carry out the Internal Revenue laws of the
United States. You are required to give us the information. We need it to ensure that you are complying with these laws and to
allow us to figure and collect the right amount of tax.
You are not required to provide the information requested on a form that is subject to the Paperwork Reduction Act unless
the form displays a valid OMB control number. Books or records relating to a form or its instructions must be retained as long
as their contents may become material in the administration of any Internal Revenue law. Generally, tax returns and return
information are confidential, as required by section 6103.
The time needed to complete and file this form will vary depending on individual circumstances. The average estimated time
is:

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Form Recordkeeping Learning about the law Preparing the form Copying, assembling,
or the form and sending the form to
the IRS
706-GS(T) 39 min. 32 min. 32 min. 20 min.
Schedule A 13 min. 13 min. 32 min. 20 min.
Schedule B 13 min. 9 min. 19 min. 20 min.

We welcome your comments about these instructions and your suggestions for future editions. You can send us comments
through IRS.gov/FormComments. Or, you can write to the Internal Revenue Service, Tax Forms and Publications, 1111
Constitution Ave. NW, IR-6526, Washington, DC 20224. Although we can't respond individually to each comment received, we
do appreciate your feedback and will consider your comments as we revise our tax forms, instructions, and publications. Do not
send tax questions, tax returns, or payments to the above address. Instead, see Where To File, earlier.

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