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Instructions for Form 706

(Rev. October 2024)

For decedents dying after December 31, 2023
United States Estate (and Generation-Skipping Transfer) Tax Return

Section references are to the Internal Revenue Code unless 
otherwise noted.                                             General Instructions

Revisions of Form 706                                        Purpose of Form
  For Decedents Dying                    Use Revision of     The executor of a decedent's estate uses Form 706 to figure 
  After               and Before         Form 706 Dated      the estate tax imposed by chapter 11 of the Internal Revenue 
December 31, 1998     January 1, 2001    July 1999           Code. This tax is levied on the entire taxable estate and not 
December 31, 2000     January 1, 2002    November 2001       just on the share received by a particular beneficiary. Form 
December 31, 2001     January 1, 2003    August 2002         706 is also used to figure the generation-skipping transfer 
December 31, 2002     January 1, 2004    August 2003         (GST) tax imposed by chapter 13 on direct skips (transfers to 
December 31, 2003     January 1, 2005    August 2004         skip persons of interests in property included in the 
December 31, 2004     January 1, 2006    August 2005         decedent's gross estate).
December 31, 2005     January 1, 2007    October 2006
December 31, 2006     January 1, 2008    September 2007      Which Estates Must File
December 31, 2007     January 1, 2009    August 2008
December 31, 2008     January 1, 2010    September 2009      For decedents who died in 2024, Form 706 must be filed by 
December 31, 2009     January 1, 2011    July 2011           the executor of the estate of every U.S. citizen or resident:
December 31, 2010     January 1, 2012    August 2011           a. Whose gross estate, plus adjusted taxable gifts and 
December 31, 2011     January 1, 2013    August 2012           specific exemption, is more than $13,610,000; or
December 31, 2012     January 1, 2017    August 2013
December 31, 2016     January 1, 2018    August 2017           b. Whose executor elects to transfer the deceased 
December 31, 2017     January 1, 2019    November 2018         spousal unused exclusion (DSUE) amount to the 
December 31, 2018                        August 2019           surviving spouse, regardless of the size of the decedent's 
                                                               gross estate. See the instructions for Part 6—Portability 
                                                               of Deceased Spousal Unused Exclusion, later, and 
Future Developments                                            sections 2010(c)(4) and (c)(5).
For the latest information about developments related to      To determine whether you must file a return for the estate 
Form 706 and its instructions, such as legislation enacted   under (a) above, add:
after they were published, go to IRS.gov/Form706.            1. The adjusted taxable gifts (as defined in section 2503) 
                                                               made by the decedent after December 31, 1976;
                                                             2. The total specific exemption allowed under section 2521 
What's New                                                     (as in effect before its repeal by the Tax Reform Act of 
Various dollar amounts and limitations in Form 706 are         1976) for gifts made by the decedent after September 8, 
indexed for inflation. For decedents dying in 2024, the        1976; and
following amounts are applicable.                            3. The decedent's gross estate valued as of the date of 
• The basic exclusion amount is $13,610,000.                   death.
• The ceiling on special-use valuation is $1,390,000.
• The amount used in figuring the 2% portion of estate tax   Gross Estate
  payable in installments is $1,850,000.                     The gross estate includes all property in which the decedent 
• The basic credit amount is $5,389,800.                     had an interest (including property outside the United 
The IRS will publish amounts for future years in annual      States). It also includes:
revenue procedures.                                          • Certain transfers made during the decedent's life without 
                                                               an adequate and full consideration in money or money's 
Reminders                                                      worth,
                                                             • Annuities,
Schedule R-1 is a separate form.  Schedule R-1 isn’t part      The includible portion of joint estates with right of 
                                                             •
of Form 706; instead, you will need to obtain a separate       survivorship (see the instructions for Schedule E),
Schedule R-1 to complete and file with Form 706.               The includible portion of tenancies by the entirety (see 
                                                             •
Identifying exhibits. Copies of tax returns filed with Form    the instructions for Schedule E),
706 must be identified as exhibits to the Form 706.          • Certain life insurance proceeds (even though payable to 
                                                               beneficiaries other than the estate) (see the instructions 
                                                               for Schedule D),
                                                             • Digital assets (see the instructions for Schedule F),
                                                             • Property over which the decedent possessed a general 
                                                               power of appointment,

                                 Instructions for Form 706 (Rev. 10-2024)  Catalog Number 16779E
Nov 14, 2024                     Department of the Treasury  Internal Revenue Service  www.irs.gov

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• Dower or curtesy (or statutory estate) of the surviving (and Generation-Skipping Transfer) Taxes, to apply for an
spouse, and automatic 6-month extension of time to file.
• Community property to the extent of the decedent's
Portability election. An executor can only elect to transfer
interest as defined by applicable law.
the DSUE amount to the surviving spouse if the Form 706 is
Note. Under the special rule of Regulations section filed timely, that is, within 9 months of the decedent's date of
20.2010-2(a)(7)(ii), executors of estates who are not required death or, if you have received an extension of time to file,
to file Form 706 under section 6018(a), but who are filing to before the 6-month extension period ends.
elect portability of the DSUE amount to the surviving spouse, Extension to elect portability. Executors who did not
are not required to report the value of certain property eligible have a filing requirement under section 6018(a) but failed to
for the marital deduction under section 2056 or 2056A or the timely file Form 706 to make the portability election may be
charitable deduction under section 2055. However, the value eligible for an extension under Rev. Proc. 2022-32, 2022-30
of those assets must be estimated and included in the total I.R.B. 101 (superseding Rev. Proc. 2017-34, 2017-26 I.R.B.
value of the gross estate. See the instructions for Part 1282). Executors filing to elect portability may now file Form
5—Recapitulation, items 10 and 23, later, for more 706 on or before the fifth anniversary of the decedent’s death.
information. An executor wishing to elect portability under this
For more specific information, see the instructions for extension must state at the top of the Form 706 being filed
Schedules A through I. that the return is “Filed Pursuant to Rev. Proc. 2022-32 to
Elect Portability under section 2010(c)(5)(A).” For more
U.S. Citizens or Residents; Nonresident information on this extension, see Rev. Proc. 2022-32.
Noncitizens Note. Any estate that is filing an estate tax return only to
File Form 706 for the estates of decedents who were either elect portability and did not file timely or within the extension
U.S. citizens or U.S. residents at the time of death. For estate provided in Rev. Proc. 2022-32 may seek relief under
tax purposes, a resident is someone who had a domicile in Regulations section 301.9100-3 to make the portability
the United States at the time of death. A person acquires a election.
domicile by living in a place for even a brief period of time, as
long as the person had no intention of moving from that Where To File
place. See Regulations section 20.0-1(b). File Form 706 at the following address.
Decedents who were neither U.S. citizens nor U.S.
Department of the Treasury
residents at the time of death file Form 706-NA, United
Internal Revenue Service
States Estate (and Generation-Skipping Transfer) Tax Return,
Kansas City, MO 64999
Estate of nonresident not a citizen of the United States.
Residents of U.S. Territories If you’re using a private delivery service (PDS), file at this
address.
All references to citizens of the United States are subject to
the provisions of sections 2208 and 2209, relating to Internal Revenue Submission Processing Center
decedents who were U.S. citizens and residents of a U.S. 333 W. Pershing Road
territory on the date of death. If such decedents became U.S. Kansas City, MO 64108
citizens only because of their connections with a territory,
then the decedents are considered nonresidents not citizens If you’re filing an amended Form 706, use the following
of the United States for estate tax purposes, and you should address.
file Form 706-NA. If such decedents became U.S. citizens
wholly independently of their connections with a territory, Internal Revenue Service Center
then the decedents are considered U.S. citizens for estate Attn: E&G, Stop 824G
tax purposes, and you should file Form 706. 7940 Kentucky Drive
Florence, KY 41042-2915
Executor
The term “executor” includes the executor, personal If you’re using a PDS for your amended Form 706, use this
representative, or administrator of the decedent's estate. If address.
none of these is appointed, qualified, and acting in the United
States, every person in actual or constructive possession of Internal Revenue Service Center
any property of the decedent is considered an executor and Attn: E&G, Stop 824G
must file a return. 7940 Kentucky Drive
Executors must provide documentation proving their Florence, KY 41042-2915
status. Documentations will vary but may include documents
such as certified copies of wills or court orders designating Paying the Tax
the executor(s). Statements by executors attesting to their
The estate and GST taxes are due within 9 months of the
status are insufficient.
date of the decedent's death. You may request an extension
When To File of time for payment by filing Form 4768. You may also elect
under section 6166 to pay in installments or under section
You must file Form 706 to report estate and/or GST tax within 6163 to postpone the part of the tax attributable to a
9 months after the date of the decedent's death. If you are reversionary or remainder interest. These elections are made
unable to file Form 706 by the due date, you may receive an by checking “Yes” on lines 3 and 4 (respectively) of Part
extension of time to file. Use Form 4768, Application for
Extension of Time To File a Return and/or Pay U.S. Estate

2 Instructions for Form 706 (Rev. 10-2024)

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3—Elections by the Executor and attaching the required             If two or more persons are liable for filing the return, they 
statements.                                                        should all join together in filing one complete return. 
                                                                   However, if they are unable to join in making one complete 
If the tax paid with the return is different from the balance 
                                                                   return, each is required to file a return disclosing all the 
due as figured on the return, explain the difference in an 
                                                                   information the person has about the estate, including the 
attached statement. If you have made prior payments to the 
                                                                   name of every person holding an interest in the property and 
IRS, attach a statement to Form 706 including these facts.
                                                                   a full description of the property. If the appointed, qualified, 
Paying by check. Make the check payable to “United States          and acting executor is unable to make a complete return, 
Treasury.” Please write the decedent's name, social security       then every person holding an interest in the property must, on 
number (SSN), and “Form 706” on the check to assist us in          notice from the IRS, make a return regarding that interest.
posting it to the proper account.
No checks of $100 million or more accepted.     The IRS            The executor who files the return must, in every case, sign 
cannot accept a single check (including a cashier's check) for     the declaration on page 1 under penalties of perjury.
amounts of $100,000,000 ($100 million) or more. If you're          Generally, anyone who is paid to prepare the return must 
sending $100 million or more by check, you'll need to spread       sign the return in the space provided and fill in the Paid 
the payments over two or more checks, with each check              Preparer Use Only area. See section 7701(a)(36)(B) for 
made out for an amount less than $100 million. The $100            exceptions.
million or more amount limit does not apply to other methods 
of payment (such as electronic payments). Please consider a        In addition to signing and completing the required 
method of payment other than a check if the amount of the          information, the paid preparer must give a copy of the 
payment is over $100 million.                                      completed return to the executor.
Electronic Federal Tax Payment System (EFTPS).                     Note. A paid preparer may sign original or amended returns 
Payment of the tax due shown on Form 706 may be                    by rubber stamp, mechanical device, or computer software 
submitted electronically through EFTPS. EFTPS is a free            program.
service of the Department of the Treasury.
To be considered timely, payments made through EFTPS               Amending Form 706
must be completed no later than 8 p.m. Eastern time the day        If you find that you must change something on a return that 
before the due date. All EFTPS payments must be scheduled          has already been filed, you should:
in advance of the due date and, if necessary, may be               • File another Form 706;
changed or canceled up to 2 business days before the               • Enter “Supplemental Information” across the top of 
scheduled payment date.                                              page 1 of the form;
To get more information about EFTPS or to enroll in                • Include a statement of what has changed, along with the 
EFTPS, visit EFTPS.gov or call 800-555-4477. To contact              supporting information; and
EFTPS using Telecommunications Relay Service (TRS) for             • Attach a copy of pages 1, 2, 3, and 4 of the original Form 
people who are deaf, hard of hearing, or have a speech               706 that has already been filed.
disability, dial 711 and then provide the TRS assistant the        For the mailing address for supplemental Form 706, see 
800-555-4477 number, above, or 800-733-4829. Additional            Filing Estate and Gift Tax Returns.
information about EFTPS is available in Pub. 966, Electronic 
Federal Tax Payment System: A Guide to Getting Started.            File the amended Form 706 at the following address.
Same-day wire. Payment of the tax due shown on Form 706              Internal Revenue Service Center
may be submitted electronically through same-day wire from           Attn: E&G, Stop 824G
your financial institution. Contact your financial institution for   7940 Kentucky Drive
availability, cost, and time frames.                                 Florence, KY 41042-2915
What you need to know about making a same-day wire 
payment.                                                           If you’re using a PDS, file at this address.
• You do not need to enroll to make a same-day wire 
  payment, and no PIN is needed.                                     Internal Revenue Service Center
• Your financial institution may charge a fee for this service.      Attn: E&G, Stop 824G
• The cutoff time to make a same-day wire payment is 5               7940 Kentucky Drive
  p.m. Eastern time. Your financial institution may have an          Florence, KY 41042-2915
  earlier cutoff time.
• Download and complete page 1 of the Same-Day                     If you have already been notified that the return has been 
  Taxpayer Worksheet, and provide pages 1 and 2 to your            selected for examination, you should provide the additional 
  financial institution. See How do I make an electronic           information directly to the office conducting the examination.
  payment under Frequently asked questions on estate 
  taxes, on IRS.gov for the worksheet and more                     Supplemental Documents
  information.
                                                                   Note. You must attach the death certificate to the return.
Signature and Verification                                         If the decedent was a citizen or resident of the United 
        If there is more than one executor, all listed executors   States and died testate (leaving a valid will), attach a certified 
                                                                   copy of the will to the return. If you cannot obtain a certified 
!       are responsible for the return. However, it is sufficient  copy, attach a copy of the will and an explanation of why it is 
CAUTION for only one of the co-executors to sign the return.
                                                                   not certified. Other supplemental documents may be 
All executors are responsible for the return as filed and are      required, as explained later. Examples include Form 712, Life 
liable for penalties imposed for erroneous or false returns.       Insurance Statement; Form 709, United States Gift (and 

Instructions for Form 706 (Rev. 10-2024)                                                                                            3

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Generation-Skipping Transfer) Tax Return; Form 706-CE,             earned), whichever is greater, for the preparation of each 
Certificate of Payment of Foreign Death Tax; trust and power       such return.
of appointment instruments; and state certification of             Estate tax return preparers who prepare any return or 
payment of death taxes. If you do not file these documents         claim for a refund are required to furnish a copy to the 
with the return, the processing of the return will be delayed.     taxpayer, sign the return, and provide their PTIN, but who fail 
  If the decedent was a U.S. citizen but not a resident of the     to do so, are subject to a penalty of $50 for such failure, 
United States, you must attach the following documents to          unless it is shown that such failure is due to reasonable 
the return.                                                        cause and not due to willful neglect.
                                                                   See sections 6694 and 6695, the related regulations, and 
1. A copy of the inventory of property and the schedule of 
                                                                   Announcement 2009-15, 2009-11 I.R.B. 687, available at 
  liabilities, claims against the estate, and expenses of 
                                                                   Announcement 2009-15, for more information.
  administration filed with the foreign court of probate 
  jurisdiction, certified by a proper official of the court.       Consistent Basis Reporting
2. A copy of the return filed under the foreign inheritance,       Certain estates are required to report to the IRS and the 
  estate, legacy, succession tax, or other death tax act,          recipient the estate tax value of each asset included in the 
  certified by a proper official of the foreign tax                gross estate within 30 days of the due date (including 
  department, if the estate is subject to such a foreign tax.      extensions) of Form 706 or the date of filing Form 706 if the 
                                                                   return is filed late. The basis of certain assets when sold or 
3. If the decedent died testate, a certified copy of the will.     otherwise disposed of must be consistent with the basis 
                                                                   (estate tax value) of the asset when it was received by the 
Rounding Off to Whole Dollars                                      beneficiary. To satisfy the consistent basis reporting 
You may round off cents to whole dollars on the return and         requirements, the estate must file Form 8971, Information 
schedules. If you do round to whole dollars, you must round        Regarding Beneficiaries Acquiring Property From a 
all amounts. To round, drop amounts under 50 cents and             Decedent, separately from the Form 706. Failure to file Form 
increase amounts from 50 to 99 cents to the next dollar. For       8971, when required, is subject to information return 
example, $1.39 becomes $1 and $2.50 becomes $3.                    penalties under sections 6721 and 6722. See Form 8971 and 
                                                                   its instructions for more information.
Penalties
Late filing and late payment.     Section 6651 provides for        Estate Tax Closing Letters
penalties for both late filing and for late payment unless there   An estate tax closing letter (ETCL) will not be issued unless a 
is reasonable cause for the delay. The law also provides for       request is made via Pay.gov. To allow time for processing, 
penalties for willful attempts to evade payment of tax. The        please wait at least 9 months after filing Form 706 to request 
late filing penalty will not be imposed if the taxpayer can show   an ETCL.
that the failure to file a timely return is due to reasonable      ETCL fee. Effective October 28, 2021, final regulations TD 
cause.                                                             9957 established a user fee of $67 for persons requesting the 
Reasonable-cause determinations.  If you receive a notice          issuance of an ETCL. To make an ETCL request after 
about penalties after you file Form 706, send an explanation       October 28, 2021, you must go to Pay.gov to submit a 
and we will determine if you meet reasonable-cause criteria.       request and pay the user fee. Go to Frequently Asked 
Do not attach an explanation when you file Form 706.               Questions on the Estate Tax Closing Letter, for instructions 
Explanations attached to the return at the time of filing will not and more information related to ETCLs.
be considered.                                                     Account transcript in lieu of ETCL.   Instead of an ETCL, 
Valuation understatement.  Section 6662 provides a 20%             the executor of the estate may request an account transcript, 
penalty for the underpayment of estate tax that exceeds            which reflects transactions including the acceptance of Form 
$5,000 when the underpayment is attributable to valuation          706 or the completion of an examination. Account transcripts 
understatements. A valuation understatement occurs when            are available online to registered tax professionals using the 
the value of property reported on Form 706 is 65% or less of       Transcript Delivery System (TDS) or to authorized 
the actual value of the property.                                  representatives making requests using Form 4506-T. Go to 
  This penalty increases to 40% if there is a gross valuation      Transcripts in Lieu of Estate Tax Closing Letters for specific 
understatement. A gross valuation understatement occurs if         instructions to request online transcripts using the TDS or 
any property on the return is valued at 40% or less of the         hardcopy transcripts using Form 4506-T.
value determined to be correct.                                    Note. For information about the release of nonresident U.S. 
  Penalties also apply to late filing, late payment, and           citizen decedents' assets using transfer certificates under 
underpayment of GST taxes.                                         Regulations section 20.6325-1, go to Transfer Certificate 
Return preparer. Estate tax return preparers who prepare           Filing Requirements for the Estates of Nonresident Citizens 
any return or claim for refund which reflects an                   of the United States or write to:
understatement of tax liability due to an unreasonable 
position are subject to a penalty equal to the greater of          Internal Revenue Service Center
$1,000 or 50% of the income earned (or to be earned) for the       Attn: E&G, Stop 824G
preparation of each such return.                                   7940 Kentucky Drive
                                                                   Florence, KY 41042-2915
  Estate tax return preparers who prepare a return or claim 
for refund which reflects an understatement of tax liability due 
to willful or reckless conduct are subject to a penalty of 
$5,000 or 75% of the income earned (or income to be 

4                                                                                      Instructions for Form 706 (Rev. 10-2024)

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IF . . . THEN . . .
Obtaining Forms and Publications To
you claim an exclusion on item 12 complete and attach Schedule U.
File or Use
Internet. You can access the IRS website at IRS.gov 24 you claim any deductions on items complete and attach the appropriate
hours a day, 7 days a week to: 14 through 22 of the Recapitulation schedules to support the claimed
deductions.
• Download forms, including talking tax forms, instructions,
and publications; you claim credits for foreign death complete and attach Schedule P or
• Order IRS products online; taxes or tax on prior transfers Q.
• Research your tax questions online;
there is not enough space on a attach a Continuation Schedule (or
• Search publications online by topic or keyword; schedule to list all the items additional sheets of the same size) to
• Use the online Internal Revenue Code, regulations, or the back of the schedule (see the
other official guidance; Continuation Schedule at the end of
• View Internal Revenue Bulletins (IRBs) published in the Form 706); photocopy the blank
last few years; and schedule before completing it, if you
• Sign up to receive local and national tax news by email. will need more than one copy.
Other forms that may be required.
• Form SS-5, Application for a Social Security Card.
• Form 706-CE, Certificate of Payment of Foreign Death Also consider the following.
Tax. • Form 706 has 29 numbered pages.
• Form 706-NA, United States Estate (and • Number the items you list on each schedule, beginning
Generation-Skipping Transfer) Tax Return, Estate of with the number “1” each time, or using the numbering
nonresident not a citizen of the United States. convention as indicated on the schedule (for example,
• Form 709-NA, United States Gift (and Schedule M).
Generation-Skipping Transfer) Tax Return of Nonresident • Total the items listed on the schedule and its
Not a Citizen of the United States. attachments, Continuation Schedules, etc.
• Form 709, United States Gift (and Generation-Skipping • Enter the total of all attachments, Continuation
Transfer) Tax Return. Schedules, etc., at the bottom of the printed schedule,
• Form 712, Life Insurance Statement. but do not carry the totals forward from one schedule to
• Form 2848, Power of Attorney and Declaration of the next.
Representative. • Enter the total, or totals, for each schedule on page 3,
• Form 4768, Application for Extension of Time To File a Part 5—Recapitulation.
Return and/or Pay U.S. Estate (and Generation-Skipping • Do not complete the “Alternate valuation date” or
Transfer) Taxes. “Alternate value” columns of any schedule unless you
• Form 4808, Computation of Credit for Gift Tax. elected alternate valuation on Part 3—Elections by the
• Form 8821, Tax Information Authorization. Executor, line 1.
• Form 8822, Change of Address. • When you complete the return, staple all the required
• Form 8971, Information Regarding Beneficiaries pages together in the proper order.
Acquiring Property From a Decedent.
Part 1—Decedent and Executor
Additional information. Pub. 559, Survivors, Executors,
and Administrators, may assist you in learning about and
Line 2
preparing Form 706.
Enter the SSN assigned specifically to the decedent. You
cannot use the SSN assigned to the decedent's spouse. If
Specific Instructions the decedent did not have an SSN, the executor should
obtain one for the decedent by filing Form SS-5 with a local
You must file the first four pages of Form 706 and all required Social Security Administration (SSA) office.
schedules. File Schedules A through I, as appropriate, to
support the entries in items 1 through 9 of Part Line 3a
5—Recapitulation. Enter the decedent’s domicile at the date of death. This
Make sure to complete the required pages and should include:
! schedules in their entirety. Returns filed without • City, town, or post office;
CAUTION entries in each field will not be processed. • County;
• State or province;
IF . . . THEN . . . • Country; and
you enter zero on any item of the you need not file the schedule • ZIP code or foreign postal code.
Recapitulation (except for Schedule F) referred to on The domicile should be the decedent’s address and not
that item.
the hospital or hospice address.
you are estimating the value of you must report the asset on the
one or more assets pursuant to appropriate schedule, but you are not Line 3b
the special rule of Regulations required to enter a value for the Enter the year the decedent established the domicile entered
section 20.2010-2(a)(7)(ii) asset. Include the estimated value of on line 3a. For estate tax purposes, a person acquires a
the asset in the totals entered on Part domicile in a place by living there, for even a brief period of
5—Recapitulation, items 10 and 23. time, with no definite present intention of later moving. For
this purpose, the United States includes only the states and

Instructions for Form 706 (Rev. 10-2024) 5

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Table A—Unified Rate Schedule

Column A Column B Column C Column D
Taxable amount over Taxable amount not over Tax on amount in column A Rate of tax on excess over amount
in column A
$0 $10,000 $0 18%
10,000 20,000 1,800 20%
20,000 40,000 3,800 22%
40,000 60,000 8,200 24%
60,000 80,000 13,000 26%
80,000 100,000 18,200 28%
100,000 150,000 23,800 30%
150,000 250,000 38,800 32%
250,000 500,000 70,800 34%
500,000 750,000 155,800 37%
750,000 1,000,000 248,300 39%
1,000,000 – – – – 345,800 40%

the District of Columbia. See Regulations section 20.0-1 for Line 3b. State Death Tax Deduction
more information. If the decedent’s domicile is other than the You may take a deduction on line 3b for estate, inheritance,
United States, see Residents of U.S. Territories, earlier. legacy, or succession taxes paid on any property included in
the gross estate as the result of the decedent's death to any
Line 6a. Name of Executor
state or the District of Columbia.
If there is more than one executor, enter the name of the
executor to be contacted by the IRS and see line 6d. You may claim an anticipated amount of deduction and
figure the federal estate tax on the return before the state
Line 6b. Executor's Address death taxes have been paid. However, the deduction cannot
Use Form 8822 to report a change of the executor's address. be finally allowed unless you pay the state death taxes and
claim the deduction within 4 years after the return is filed, or
Line 6c. Executor's Social Security Number later (see section 2058(b)) if:
Only one executor should complete this line. If there is more • A petition is filed with the Tax Court of the United States,
than one executor, see line 6d. • You have an extension of time to pay, or
• You file a claim for refund or credit of an overpayment
Line 6d. Multiple Executors which extends the deadline for claiming the deduction.
Check here if there is more than one executor. On an Note. The deduction is not subject to dollar limits.
attached statement, provide the name, address, telephone If you make a section 6166 election to pay the federal
number, and SSN of any executor other than the one named estate tax in installments and make a similar election to pay
on line 6a. the state death tax in installments, see section 2058(b) for
exceptions and periods of limitation.
Line 11. Special Rule
If you transfer property other than cash to the state in
If the estate is estimating the value of assets under the payment of state inheritance taxes, the amount you may
special rule of Regulations section 20.2010-2(a)(7)(ii), check claim as a deduction is the lesser of the state inheritance tax
here and see the instructions for Part 5—Recapitulation, liability discharged or the fair market value (FMV) of the
items 10 and 23. property on the date of the transfer. For more information on
the application of such transfers, see the principles
Part 2—Tax Computation discussed in Rev. Rul. 86-117, 1986-2 C.B. 157, prior to the
In general, the estate tax is figured by applying the unified repeal of section 2011.
rates shown in Table A to the total of transfers both during life Send the following evidence to the IRS.
and at death, and then subtracting the gift taxes, as refigured
based on the date of death rates. See Worksheet TG, the 1. Certificate of the proper officer of the taxing state, or the
Line 4 Worksheet, and the Line 7 Worksheet. District of Columbia, showing the following.
Note. You must complete Part 2—Tax Computation. a. Total amount of tax imposed (before adding interest
and penalties and before allowing discount).
Line 1 b. Amount of discount allowed.
If you elected alternate valuation on Part 3—Elections by the
c. Amount of penalties and interest imposed or
Executor, line 1, enter the amount you entered in the
charged.
“Alternate value” column of Part 5—Recapitulation, item 13.
Otherwise, enter the amount from the “Value at date of death” d. Total amount actually paid in cash.
column.
e. Date of payment.
2. Any additional proof the IRS specifically requests.

6 Instructions for Form 706 (Rev. 10-2024)

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File the evidence requested above with the return, if Taxable Gift Amount Table
possible. Otherwise, send it as soon as possible after
the return is filed. Column A Column B Column C Column D
Line 6 Amount in Row Amount in Row Property Value Rate (Divisor) on
(p), Line 7 (p), Line 7 on Amount in Excess of
To figure the tentative tax on the amount on line 5, use Table Worksheet over... Worksheet not Column A Amount in
A—Unified Rate Schedule and put the result on this line. over... Column A
$0 $1,800 $0 18%
Lines 4 and 7
Three worksheets are provided to help you figure the entries 1,800 3,800 10,000 20%
for these lines. Worksheet TG—Taxable Gifts Reconciliation 3,800 8,200 20,000 22%
allows you to reconcile the decedent's lifetime taxable gifts to 8,200 13,000 40,000 24%
figure totals that will be used for the Line 4 Worksheet and
the Line 7 Worksheet. 13,000 18,200 60,000 26%
18,200 23,800 80,000 28%
You must have all of the decedent's gift tax returns (Forms
709) before completing Worksheet TG—Taxable Gifts 23,800 38,800 100,000 30%
Reconciliation. The amounts needed for Worksheet TG can 38,800 70,800 150,000 32%
usually be found on the filed returns that were subject to tax.
70,800 155,800 250,000 34%
However, if any of the returns were audited by the IRS, use
the amounts that were finally determined as a result of the 155,800 248,300 500,000 37%
audits. 248,300 345,800 750,000 39%
In addition, you must make a reasonable effort to discover 345,800 – – – – – – 1,000,000 40%
any gifts in excess of the annual exclusion made by the
decedent (or on behalf of the decedent under a power of
attorney) for which no Forms 709 were filed. Include the value How to complete the Line 7 Worksheet.
of such gifts in column b of Worksheet TG. The annual Row (a). Beginning with the earliest year in which the taxable
exclusion per donee is as follows. gifts were made, enter the tax period of prior gifts. If you filed
returns for gifts made after 1981, enter the calendar year in
Period Annual Exclusion Amount Per Row (a) as (YYYY). If you filed returns for gifts made after
Donee 1976 and before 1982, enter the calendar quarters in Row (a)
1977 through 1981 $3,000 as (YYYY-Q).
Row (b). Enter all taxable gifts made in the specified year.
1981 through 2001 $10,000 Enter all pre-1977 gifts in the pre-1977 column.
2002 through 2005 $11,000 Row (c). Enter the amount from Row (d) of the previous
2006 through 2008 $12,000 column.
Row (d). Enter the sum of Row (b) and Row (c) from the
2009 through 2012 $13,000 current column.
2013 through 2017 $14,000 Row (e). Enter the amount from Row (f) of the previous
2018 through 2021 $15,000 column.
Row (f). Enter the tax based on the amount in Row (d) of the
2022 $16,000 current column using Table A—Unified Rate Schedule.
2023 $17,000 Row (g). Subtract the amount in Row (e) from the amount in
2024 $18,000 Row (f) for the current column.
Row (h). Complete this row only if a DSUE amount was
received from predeceased spouse(s) and was applied to
lifetime gifts or if a Restored Exclusion Amount on taxable
gifts to a same-sex spouse was applied to lifetime gifts (or
both). Enter the sum of lines 2 and 3 from Schedule C on the
Form 709 filed for the year listed in Row (a) for the amount to
be entered in this row.
Row (i). Enter the applicable amount from the Table of Basic
Exclusion Amounts.
Row (j). Enter the sum of Row (h) and Row (i).
Row (k). Figure the applicable credit on the amount in Row
(j) using Table A—Unified Rate Schedule, and enter here.
Note. The entries in each column of Row (k) must be
reduced by 20% of the amount allowed as a specific
exemption for gifts made after September 8, 1976, and
before January 1, 1977 (but no more than $6,000).
Row (l). Add the amounts in Row (l) and Row (n) from the
previous column.
Row (m). Subtract the amount in Row (l) from the amount in
Row (k) to determine the amount of any available credit.
Enter the result in Row (m).

Instructions for Form 706 (Rev. 10-2024) 7

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Row (n). Enter the lesser of the amounts in Row (g) or Row                                   Period                               Basic Exclusion                      Credit Equivalent 
(m).                                                                                                                              Amount                               at 2024 Rates
Row (o). Subtract the amount in Row (n) from the amount in                   1985                                                 $400,000                             $121,800
Row (g) for the current column.
Row (p). Subtract the amount in Row (o) from the amount in                   1986                                                 $500,000                             $155,800
Row (f) for the current column.                                              1987 through 1997                                    $600,000                             $192,800
Row (q). Enter the Cumulative Taxable Gift amount based on                   1998                                                 $625,000                             $202,050
the amount in Row (p) using the Taxable Gift Amount Table.
Row (r). If Row (o) is greater than zero in the applicable                   1999                                                 $650,000                             $211,300
period, subtract Row (q) from Row (d). If Row (o) is not                     2000 and 2001                                        $675,000                             $220,550
greater than zero, enter -0-.                                                2002 through 2010                                    $1,000,000                           $345,800
  Repeat for each year in which taxable gifts were                           2011                                                 $5,000,000                           $1,945,800
made.
                                                                             2012                                                 $5,120,000                           $1,993,800
        Remember to submit a copy of the Line 7 Worksheet 
                                                                             2013                                                 $5,250,000                           $2,045,800
  !     when you file Form 706. If additional space is needed 
CAUTION to report prior gifts, please attach additional sheets.              2014                                                 $5,340,000                           $2,081,800
                                                                             2015                                                 $5,430,000                           $2,117,800
Table of Basic Exclusion Amounts
                                                                             2016                                                 $5,450,000                           $2,125,800
        Period                 Basic Exclusion       Credit Equivalent       2017                                                 $5,490,000                           $2,141,800
                                  Amount               at 2024 Rates
                                                                             2018                                                 $11,180,000                          $4,417,800
1977 (Quarters 1 and 2)           $30,000              $6,000
                                                                             2019                                                 $11,400,000                          $4,505,800
1977 (Quarters 3 and 4)           $120,667             $30,000
                                                                             2020                                                 $11,580,000                          $4,577,800
1978                              $134,000             $34,000
                                                                             2021                                                 $11,700,000                          $4,625,800
1979                              $147,333             $38,000
                                                                             2022                                                 $12,060,000                          $4,769,800
1980                              $161,563             $42,500
                                                                             2023                                                 $12,920,000                          $5,113,800
1981                              $175,625             $47,000
                                                                             2024                                                 $13,610,000                          $5,389,800
1982                              $225,000             $62,800
1983                              $275,000             $79,300
1984                              $325,000             $96,300

Worksheet TG—Taxable Gifts Reconciliation
Worksheet TG—Taxable Gifts Reconciliation
(To be used for lines 4 and 7 of the Tax Computation)
               a.                        b.            Note. For the definition of a taxable gift, see section 2503. Follow Form 709. That is, include only 
  Gifts Calendar year or       Total taxable gifts for the decedent’s one-half of split gifts, whether the gifts were made by the decedent or the 
  made  calendar quarter       period (see Note)       decedent’s spouse. In addition to gifts reported on Form 709, you must include any taxable gifts 
  after                                                in excess of the annual exclusion that were not reported on Form 709.
June 6,                                                     c.                               d.                                   e.                                   f.
  1932,                                                Taxable amount        Taxable amount included                              Gift tax paid by                     Gift tax paid by 
  and                                                  included in column b  in column b for gifts that                           decedent on gifts in                 decedent's spouse 
before                                                 for gifts included in qualify for “special                                 column d                             on gifts in column c
  1977  1. Total taxable gifts                         the gross estate      treatment of split gifts” 
          made before 1977                                                   described below
  Gifts 
  made 
  after 
  1976
2. Totals for gifts made after 
  1976
Line 4 Worksheet—Adjusted Taxable Gifts Made After 1976
1. Taxable gifts made after 1976. Enter the amount from Worksheet TG, line 2, column b . . . . . . . . . . . . . . . . . . . . . . . . .                             1.
2. Taxable gifts made after 1976 reportable on Schedule G. Enter the amount from Worksheet 
   TG, line 2, column c . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2.
3. Taxable gifts made after 1976 that qualify for “special treatment.” Enter the amount from 
   Worksheet TG, line 2, column d . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .         3.
4. Add lines 2 and 3 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4.
5. Adjusted taxable gifts. Subtract line 4 from line 1. Enter here and on Part 2—Tax Computation, line 4                        . . . . . . . . . . . . . .          5.

8                                                                                                                               Instructions for Form 706 (Rev. 10-2024)

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Line 7 Worksheet—Submit a copy with Form 706
Line 7 Worksheet, Part A—Used to determine Applicable Credit Allowable for Prior Periods after 1976
      (a) Tax Period1                                                                                                       Pre-1977
      (b) Taxable Gifts for Applicable Period
      (c) Taxable Gifts for Prior Periods2
      (d) Cumulative Taxable Gifts Including Applicable 
          Period (add Row (b) and Row (c))
      (e) Tax at Date of Death Rates for Prior Gifts (from 3
          Row (c))
      (f) Tax at Date of Death Rates for Cumulative 
          Taxable Gifts Including Applicable Period (from 
          Row (d))
      (g) Tax at Date of Death Rates for Gifts in 
          Applicable Period (subtract Row (e) from Row 
          (f))
      (h) Total DSUE applied and Restorable Exclusion 
          Amount from Prior Periods and Applicable 
          Period (see instructions later)
      (i) Basic Exclusion for Applicable Period (Enter the 
          amount from the Table of Basic Exclusion 
          Amounts)
      (j) Applicable Exclusion Amount (add Row (h) and 
          Row (i)) 
      (k) Maximum Applicable Credit amount based on 
          Row (j) (Using Table A—Unified Rate 4
          Schedule)
      (l) Applicable Credit amount used in Prior Periods 
          (add Row (l) and Row (n) from prior period)
      (m) Available Credit in Applicable Period (subtract 
          Row (l) from Row (k))
      (n) Credit Allowable (lesser of Row (g) or Row (m))
      (o) Tax paid or payable at Date of Death rates for 
          Applicable Period (subtract Row (n) from Row 
          (g))
      (p) Tax on Cumulative Gifts less tax paid or payable 
          for Applicable Period (subtract Row (o) from 
          Row (f))
      (q) Cumulative Taxable Gifts less Gifts in the 
          Applicable Period on which tax was paid or 
          payable based on Row (p) (Using the Taxable 
          Gift Amount Table)
      (r) Gifts in the Applicable Period on which tax was 
          payable (subtract Row (q) from Row (d))
Line 7 Worksheet, Part B
      1   Total gift taxes payable on gifts after 1976 (sum of amounts in Row (o)).
      2   Gift taxes paid by the decedent on gifts that qualify for “special treatment.” Enter the amount from Worksheet TG, line 2, col. e.
      3   Subtract line 2 from line 1.
      4   Gift tax paid by decedent's spouse on split gifts included on Schedule G. Enter amount from Worksheet TG, line 2, col. f.
      5   Add lines 3 and 4. Enter here and on Part 2—Tax Computation, line 7.
      6   Cumulative lifetime gifts on which tax was paid or payable. Enter this amount on Form 706, Part 6–Portability of Deceased 
          Spousal Unused Exclusion (DSUE), Section C, line 3 (sum of amounts in Row (r)).

23 4 1 Row (c): Enter amount from Row (d) of the previous column.  Row (a): For annual returns, enter the tax period as (YYYY). For quarterly returns, enter tax period as (YYYY-Q).Row (e): Enter amount from Row (f) of the previous column.Row (k): Figure the applicable credit on the amount in Row (j), using Table A—Unified Rate Schedule, and enter here. (For each column in Row (k), subtract 20% of any 
amount allowed as a specific exemption for gifts made after September 8, 1976, and before January 1, 1977.)

Note.     In figuring the line 7 amount, do not include any tax                                                                     If all four conditions above are met, do not include these 
paid or payable on gifts made before 1977. The line 7 amount                                                                        gifts on line 4 of the Tax Computation and do not include the 
is a hypothetical figure used to figure the estate tax.                                                                             gift taxes payable on these gifts on line 7 of the Tax 
                                                                                                                                    Computation. These adjustments are incorporated into the 
Special treatment of split gifts.            These special rules apply                                                              worksheets.
only if:
•     The decedent's spouse predeceased the decedent;                                                                               Lines 9a Through 9e. Applicable Credit Amount 
•     The decedent's spouse made gifts that were “split” with                                                                       (Formerly Unified Credit Amount)
      the decedent under the rules of section 2513;
•     The decedent was the “consenting spouse” for those split                                                                      The applicable credit amount is allowable credit against 
      gifts, as that term is used on Form 709; and                                                                                  estate and gift taxes. It is figured by determining the tentative 
•     The split gifts were included in the decedent's spouse's                                                                      tax on the applicable exclusion amount, which is the amount 
      gross estate under section 2035.                                                                                              that can be transferred before an estate tax liability will be 
                                                                                                                                    incurred.

Instructions for Form 706 (Rev. 10-2024)                                                                                                                                                                                                                                                                                                                                                                            9

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The applicable exclusion amount equals the total of lines Gross estate tax minus (the sum of the state
9a, 9b, and 9c. See Lines 9d and 9e, applicable exclusion death taxes and unified credit) Value of
and credit amount, later, for more information. Value of gross estate minus (the sum of the x included
gift
Line 9a, basic exclusion amount. In 2024, the basic deductions for charitable, public, and similar
exclusion amount, as adjusted for inflation under section gifts and bequests and marital deduction)
2010(c)(3), is $13,610,000.
Line 9b, DSUE. If the decedent had a spouse who died after
2010, whose estate did not use all of its applicable exclusion When taking the credit for pre-1977 federal gift taxes:
against gift or estate tax liability, a DSUE amount may be • Include the credit in the amount on line 15; and
available for use by the decedent's estate. If the predeceased • Identify and enter the amount of the credit you are taking
spouse died in 2011, the DSUE amount was figured and on the dotted line to the left of the entry space for line 15
attached to the predeceased spouse’s Form 706. If the on page 1 of Form 706 with a notation, “Section 2012
predeceased spouse died in 2012 or after, this amount is credit.”
found in Part 6, Section C, of the Form 706 filed by the estate For more information, see the regulations under section
of the decedent's predeceased spouse. The amount to be 2012. This computation may be made using Form 4808.
entered on line 9b is figured in Part 6, Section D. Attach a copy of a completed Form 4808 or the computation
Line 9c, restored exclusion amount. If a decedent made a of the credit. Also, attach all available copies of Forms 709
taxable gift during the decedent's lifetime to the decedent's filed by the decedent, with "Exhibit to Estate Tax Return"
same-sex spouse and that transfer resulted in a reduction of entered across the top of the first page of each, to help verify
the decedent's available applicable exclusion amount, the the amounts entered on lines 4 and 7, and the amount of
amount of the applicable exclusion that was reduced can be credit taken (on line 15) for pre-1977 federal gift taxes.
restored. If the applicable exclusion was previously restored Canadian marital credit. In addition to using line 15 to
on a Form 709, enter the value on Schedule C, line 3, of Form report credit for federal gift taxes on pre-1977 gifts, you may
709. If the applicable exclusion has not yet been previously also use line 15 to claim the Canadian marital credit, where
restored, follow the directions in the instructions for Form applicable.
709, Schedule C, to determine the Restored Exclusion
Amount. The Restored Exclusion Amount is entered on When taking the marital credit under the 1995 Canadian
line 9c. Protocol:
• Include the credit in the amount on line 15; and
Lines 9d and 9e, applicable exclusion and credit • Identify and enter the amount of the credit you are taking
amount. The total of lines 9a, 9b, and 9c is entered on on the dotted line to the left of the entry space for line 15
line 9d. If the amounts entered on both lines 9b and 9c are on page 1 of Form 706 with a notation, “Canadian marital
zero, enter $5,389,800 on line 9e. Otherwise, determine the credit.”
applicable credit on the amount on line 9d by using Table
A—Unified Rate Schedule and enter the result on line 9e. Also, attach a statement to the return that refers to the
treaty, waives qualifying domestic trust (QDOT) rights, and
Line 10. Adjustment to Applicable Credit shows the computation of the marital credit. See the 1995
Canadian income tax treaty protocol for details on figuring the
If the decedent made gifts (including gifts made by the credit.
decedent's spouse and treated as made by the decedent by
reason of gift splitting) after September 8, 1976, and before
January 1, 1977, for which the decedent claimed a specific Part 3—Elections by the Executor
exemption, the applicable credit amount on this estate tax
return must be reduced. The reduction is figured by entering Note. The election to allow the decedent's surviving spouse
20% of the specific exemption claimed for these gifts. to use the decedent's unused exclusion amount is made by
filing a timely and complete Form 706. See the instructions
Note. The specific exemption was allowed by section 2521 for Part 6—Portability of Deceased Spousal Unused
for gifts made before January 1, 1977. Exclusion, later, and sections 2010(c)(4) and (c)(5).
If the decedent did not make any gifts between September
8, 1976, and January 1, 1977, or if the decedent made gifts Line 1. Alternate Valuation
during that period but did not claim the specific exemption, See the example showing the use of Schedule B
enter zero. TIP where the alternate valuation is adopted, later.

Line 15. Total Credits Unless you elect at the time the return is filed to adopt
Generally, line 15 is used to report the total of credit for alternate valuation, as authorized by section 2032, value all
foreign death taxes (line 13) and credit for tax on prior property included in the gross estate as of the date of the
transfers (line 14). decedent's death. Alternate valuation cannot be applied to
However, you may also use line 15 to report credit taken only a part of the property.
for federal gift taxes imposed by chapter 12 of the Code, and You may elect special-use valuation (line 2) in addition to
the corresponding provisions of prior laws, on certain alternate valuation.
transfers the decedent made before January 1, 1977, that are
included in the gross estate. The credit cannot be more than You may not elect alternate valuation unless the election
the amount figured by the following formula. will decrease both the value of the gross estate and the sum
(reduced by allowable credits) of the estate and GST taxes
payable by reason of the decedent's death for the property
includible in the decedent's gross estate.

10 Instructions for Form 706 (Rev. 10-2024)

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Elect alternate valuation by checking “Yes” on line 1 and On Schedules A through I, you must show the following.
filing Form 706. You may make a protective alternate
1. What property is included in the gross estate on the date
valuation election by checking “Yes” on line 1, writing the
of the decedent's death.
word “protective,” and filing Form 706 using regular values.
Once made, the election may not be revoked. The election 2. What property was distributed, sold, exchanged, or
may be made on a late-filed Form 706, provided it is not filed otherwise disposed of within the 6-month period after the
later than 1 year after the due date (including extensions decedent's death, and the dates of these distributions,
actually granted). Relief under Regulations sections etc. (These two items should be entered in the
301.9100-1 and 301.9100-3 may be available to make an “Description” column of each schedule. Briefly explain
alternate valuation election or a protective alternate valuation the status or disposition governing the alternate
election, provided a Form 706 is filed no later than 1 year valuation date, such as “Not disposed of within 6 months
after the due date of the return (including extensions actually following death,” “Distributed,” “Sold,” “Bond paid on
granted). maturity,” etc. In this same column, describe each item of
principal and includible income.)
If alternate valuation is elected, value the property
included in the gross estate as of the following dates, as 3. The date of death value, entered in the appropriate value
applicable. column with items of principal and includible income
• Any property distributed, sold, exchanged, or otherwise shown separately.
disposed of or separated or passed from the gross estate 4. The alternate value, entered in the appropriate value
by any method within 6 months after the decedent's column with items of principal and includible income
death is valued on the date of distribution, sale, shown separately. (In the case of any interest or estate,
exchange, or other disposition. Value this property on the the value of which is affected by lapse of time, such as
date it ceases to be a part of the gross estate; for patents, leaseholds, estates for the life of another, or
example, on the date the title passes as the result of its remainder interests, the value shown under the heading
sale, exchange, or other disposition. “Alternate value” must be the adjusted value, for
• Any property not distributed, sold, exchanged, or example, the value as of the date of death with an
otherwise disposed of within the 6-month period is adjustment reflecting any difference in its value as of the
valued as of 6 months after the date of the decedent's later date not due to lapse of time.)
death.
• Any property, interest, or estate that is affected by mere Note. If any property on Schedules A through I is being
lapse of time is valued as of the date of the decedent's valued pursuant to the special rule of Regulations section
death or on the date of its distribution, sale, exchange, or 20.2010-2(a)(7)(ii), values for those assets are not required
other disposition, whichever occurs first. However, you to be reported on the schedule. See Part 5—Recapitulation,
may change the date of death value to account for any item 10, later.
change in value that is not due to a “mere lapse of time”
on the date of its distribution, sale, exchange, or other Distributions, sales, exchanges, and other dispositions of
disposition. the property within the 6-month period after the decedent's
death must be supported by evidence. If the court issued an
The property included in the alternate valuation and order of distribution during that period, you must submit a
valued as of 6 months after the date of the decedent's death, certified copy of the order as part of the evidence. The IRS
or as of some intermediate date (as described above), is the may require you to submit additional evidence, if necessary.
property included in the gross estate on the date of the
decedent's death. Therefore, you must first determine what If the alternate valuation method is used, the values of life
property was part of the gross estate at the decedent's death. estates, remainders, and similar interests are figured using
Interest. Interest accrued to the date of the decedent's the age of the recipient on the date of the decedent's death
death on bonds, notes, and other interest-bearing obligations and the value of the property on the alternate valuation date.
is property of the gross estate on the date of death and is
Line 2. Special-Use Valuation of Section 2032A
included in the alternate valuation.
Rent. Rent accrued to the date of the decedent's death on In general. Under section 2032A, you may elect to value
leased real or personal property is property of the gross certain farm and closely held business real property at its
estate on the date of death and is included in the alternate farm or business use value rather than its FMV. Both
valuation. special-use valuation and alternate valuation may be elected.
To elect special-use valuation, check “Yes” on line 2 and
Dividends. Outstanding dividends that were declared to complete and attach Schedule A-1 and its required additional
stockholders of record on or before the date of the statements. You must file Schedule A-1 and its required
decedent's death are considered property of the gross estate attachments with Form 706 for this election to be valid. You
on the date of death and are included in the alternate may make the election on a late-filed return so long as it’s the
valuation. Ordinary dividends declared to stockholders of first return filed.
record after the date of the decedent's death are not included
in the gross estate on the date of death and are not eligible The total value of the property valued under section 2032A
for alternate valuation. However, if dividends are declared to may not be decreased from FMV by more than $1,390,000
stockholders of record after the date of the decedent's death for decedents dying in 2024.
so that the shares of stock at the later valuation date do not Real property may qualify for the section 2032A election if:
reasonably represent the same property at the date of the 1. The decedent was a U.S. citizen or resident at the time of
decedent's death, include those dividends (except dividends
death;
paid from earnings of the corporation after the date of the
decedent's death) in the alternate valuation. 2. The real property is located in the United States;

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3. At the decedent's death, the real property was used by Structures and other real property improvements.
the decedent or a family member for farming or in a trade Qualified real property includes residential buildings and
or business, or was rented for such use by either the other structures and real property improvements regularly
surviving spouse or a lineal descendant of the decedent occupied or used by the owner or lessee of real property (or
to a family member on a net cash basis; by the employees of the owner or lessee) to operate a farm or
4. The real property was acquired from or passed from the other closely held business. A farm residence that the
decedent to a qualified heir of the decedent; decedent occupied is considered to have been occupied for
the purpose of operating the farm even when a family
5. The real property was owned and used in a qualified member and not the decedent was the person materially
manner by the decedent or a member of the decedent's participating in the operation of the farm.
family during 5 of the 8 years before the decedent's
Qualified real property also includes roads, buildings, and
death;
other structures and improvements functionally related to the
6. There was material participation by the decedent or a qualified use.
member of the decedent's family during 5 of the 8 years Elements of value such as mineral rights that are not
before the decedent's death; and related to the farm or business use are not eligible for
7. The property meets the following percentage special-use valuation.
requirements. Property acquired from the decedent. Property is
a. At least 50% of the adjusted value of the gross estate considered to have been acquired from or to have passed
must consist of the adjusted value of real or personal from the decedent if one of the following applies.
property that was being used as a farm or in a closely • The property is considered to have been acquired from
held business and that was acquired from, or passed or to have passed from the decedent under section
from, the decedent to a qualified heir of the 1014(b) (relating to basis of property acquired from a
decedent. decedent).
• The property is acquired by any person from the estate.
b. At least 25% of the adjusted value of the gross estate • The property is acquired by any person from a trust, to
must consist of the adjusted value of qualified farm or the extent the property is includible in the gross estate.
closely held business real property.
Qualified heir. A person is a qualified heir of property if the
For this purpose, adjusted value is the value of property person is a member of the decedent's family and acquired or
determined without regard to its special-use value. The value received the property from the decedent. If a qualified heir
is reduced for unpaid mortgages on the property or any disposes of any interest in qualified real property to any
indebtedness against the property, if the full value of the member of the qualified heir’s family, that person will then be
decedent's interest in the property (not reduced by such treated as the qualified heir for that interest.
mortgage or indebtedness) is included in the value of the
A member of the family includes only:
gross estate. The adjusted value of the qualified real and
personal property used in different businesses may be • An ancestor (parent, grandparent, etc.) of the individual;
combined to meet the 50% and 25% requirements. • The spouse of the individual;
• The lineal descendant (child, stepchild, grandchild, etc.)
of the individual, the individual's spouse, or a parent of
Qualified Real Property the individual; or
Qualified use. Qualified use means use of the property as a • The spouse or surviving spouse of any lineal descendant
farm for farming purposes or in a trade or business other than described above.
farming. Trade or business applies only to the active conduct Note. A legally adopted child of an individual is treated as a
of a business. It does not apply to passive investment child of that individual by blood.
activities or the mere passive rental of property to a person
other than a member of the decedent's family. Also, no trade
or business is present in the case of activities not engaged in Material Participation
for profit.
To elect special-use valuation, either the decedent or a
Ownership. To qualify as special-use property, the decedent member of the decedent’s family must have materially
or a member of the decedent's family must have owned and participated in the operation of the farm or other business for
used the property in a qualified use for 5 of the last 8 years at least 5 of the 8 years ending on the date of the decedent's
before the decedent's death. Ownership may be direct or death. The existence of material participation is a factual
indirect through a corporation, a partnership, or a trust. determination. Passively collecting rents, salaries, draws,
If the ownership is indirect, the business must qualify as a dividends, or other income from the farm or other business is
closely held business under section 6166. The indirect not sufficient for material participation, nor is merely
ownership, when combined with periods of direct ownership, advancing capital and reviewing a crop plan and financial
must meet the requirements of section 6166 on the date of reports each season or business year.
the decedent's death and for a period of time that equals at
least 5 of the 8 years preceding death. In determining whether the required participation has
occurred, disregard brief periods (that is, 30 days or less)
Directly owned property leased by the decedent to a during which there was no material participation, as long as
separate closely held business is considered qualified real such periods were both preceded and followed by substantial
property if the business entity to which it was rented was a periods (more than 120 days) during which there was
closely held business (as defined by section 6166) for the uninterrupted material participation.
decedent on the date of the decedent's death and for
sufficient time to meet the “5 in 8 years” test explained above.

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Retirement or disability. If, on the date of death, the time The rental must have resulted from an arm's-length
period for material participation could not be met because the transaction and the amount of rent may not be reduced by
decedent was retired or disabled, a substitute period may the amount of any expenses or liabilities associated with the
apply. The decedent must have retired on social security or farm operation or the lease.
been disabled for a continuous period ending with death. A Comparable property. Comparable property must be
person is disabled for this purpose if the person was mentally situated in the same locality as the qualified real property as
or physically unable to materially participate in the operation determined by generally accepted real property valuation
of the farm or other business. rules. The determination of comparability is based on a
number of factors, none of which carries more weight than
The substitute time period for material participation for
the others. It is often necessary to value land in segments
these decedents is a period totaling at least 5 years out of the
where there are different uses or land characteristics
8-year period that ended on the earlier of:
included in the specially valued land.
• The date the decedent began receiving social security
benefits, or The following list contains some of the factors considered
• The date the decedent became disabled. in determining comparability.
• Similarity of soil.
Surviving spouse. A surviving spouse who received • Whether the crops grown would deplete the soil in a
qualified real property from the predeceased spouse is similar manner.
considered to have materially participated if the surviving • Types of soil conservation techniques that have been
spouse was engaged in the active management of the farm practiced on the two properties.
or other business. If the surviving spouse died within 8 years • Whether the two properties are subject to flooding.
of the first spouse's death, you may add the period of • Slope of the land.
material participation of the predeceased spouse to the • For livestock operations, the carrying capacity of the
period of active management by the surviving spouse to land.
determine if the surviving spouse's estate qualifies for • For timbered land, whether the timber is comparable.
special-use valuation. To qualify for this, the property must • Whether the property as a whole is unified or segmented.
have been eligible for special-use valuation in the If segmented, the availability of the means necessary for
predeceased spouse's estate, though it does not have to movement among the different sections.
have been elected by that estate. • Number, types, and conditions of all buildings and other
For additional details regarding material participation, see fixed improvements located on the properties and their
Regulations section 20.2032A-3(e). location as it affects efficient management, use, and
value of the property.
Valuation Methods • Availability and type of transportation facilities in terms of
costs and of proximity of the properties to local markets.
The primary method of valuing special-use property that is You must specifically identify on the return the property
used for farming purposes is the annual gross cash rental being used as comparable property. Use the type of
method. If comparable gross cash rentals are not available, descriptions used to list real property on Schedule A.
you can substitute comparable average annual net share Effective interest rate. See Tables 1 and 2 of Rev. Rul.
rentals. If neither of these is available, or if you so elect, you 2024-16, 2024-35 I.R.B. 534, available at Rev. Rul. 2024-16,
can use the method for valuing real property in a closely held for the average annual effective interest rates in effect for
business. 2024.
Average annual gross cash rental. Generally, the Net share rental. You may use average annual net share
special-use value of property that is used for farming rental from comparable land only if there is no comparable
purposes is determined as follows. land from which average annual gross cash rental can be
determined. Net share rental is the difference between the
1. Subtract the average annual state and local real estate gross value of produce received by the lessor from the
taxes on actual tracts of comparable real property from comparable land and the cash operating expenses (other
the average annual gross cash rental for that same than real estate taxes) of growing the produce that, under the
comparable property. lease, are paid by the lessor. The production of the produce
2. Divide the result in (1) by the average annual effective must be the business purpose of the farming operation. For
interest rate charged for all new federal land bank loans. this purpose, produce includes livestock.
See Effective interest rate, later. The gross value of the produce is generally the gross
amount received if the produce was disposed of in an
The computation of each average annual amount is based arm's-length transaction within the period established by the
on the 5 most recent calendar years ending before the date Department of Agriculture for its price support program.
of the decedent's death. Otherwise, the value is the weighted average price for which
Gross cash rental. Generally, gross cash rental is the the produce sold on the closest national or regional
total amount of cash received in a calendar year for the use commodities market. The value is figured for the date or
of actual tracts of comparable farm real property in the same dates on which the lessor received (or constructively
locality as the property being specially valued. You may not received) the produce.
use:
• Appraisals or other statements regarding rental value or Valuing a real property interest in a closely held busi-
areawide averages of rentals, ness. Use this method to determine the special-use
• Rents paid wholly or partly in-kind, or valuation for qualifying real property used in a trade or
• Property for which the amount of rent is based on business other than farming. You may also use this method
production. for qualifying farm property if there is no comparable land or if

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you elect to use it. Under this method, the following factors To make a protective election, check “Yes” on line 2 and
are considered. complete Schedule A-1 according to the instructions for
• The capitalization of income that the property can be Protective election, later.
expected to yield for farming or for closely held business
purposes over a reasonable period of time with prudent If you make a protective election, complete the initial Form
management and traditional cropping patterns for the 706 by valuing all property at its FMV. Do not use special-use
area, taking into account soil capacity, terrain valuation. Usually, this will result in higher estate and GST tax
configuration, and similar factors. liabilities than will be ultimately determined if special-use
• The capitalization of the fair rental value of the land for valuation is allowed. The protective election does not extend
farming or for closely held business purposes. the time to pay the taxes shown on the return. If you wish to
• The assessed land values in a state that provides a extend the time to pay the taxes, file Form 4768 in adequate
differential or use value assessment law for farmland or time before the due date of the return. See the Instructions for
closely held business. Form 4768.
• Comparable sales of other farm or closely held business
land in the same geographical area far enough removed If the estate qualifies for special-use valuation based on
from a metropolitan or resort area so that nonagricultural the values as finally determined, you must file an amended
use is not a significant factor in the sales price. Form 706 (with a complete section 2032A election) within 60
• Any other factor that fairly values the farm or closely held days after the date of this determination. Prepare the
business value of the property. amended return using special-use values under the rules of
section 2032A, complete Schedule A-1, and attach all of the
Making the Election required statements.

Include the words “Section 2032A valuation” in the Additional Information
“Description” column of any Form 706 schedule if section
2032A property is included in the decedent's gross estate. For definitions and additional information, see section 2032A
and the related regulations.
An election under section 2032A need not include all the
property in an estate that is eligible for special-use valuation, Line 3. Section 6166 Installment Payments
but sufficient property to satisfy the threshold requirements of If the gross estate includes an interest in a closely held
section 2032A(b)(1)(B) must be specially valued under the business, you may be able to elect to pay part of the estate
election. tax in installments under section 6166.
If joint or undivided interests (that is, interests as joint The maximum amount that can be paid in installments is
tenants or tenants in common) in the same property are that part of the estate tax that is attributable to the closely
received from a decedent by qualified heirs, an election for held business; see Determine how much of the estate tax
one heir's joint or undivided interest need not include any may be paid in installments under section 6166, later. In
other heir's interest in the same property if the electing heir's general, that amount is the amount of tax that bears the same
interest plus other property to be specially valued satisfies ratio to the total estate tax that the value of the closely held
the requirements of section 2032A(b)(1)(B). business included in the gross estate bears to the adjusted
gross estate.
If successive interests (that is, life estates and remainder Bond or lien. The IRS may require that an estate furnish a
interests) are created by a decedent in otherwise qualified surety bond when granting the installment payment election.
property, an election under section 2032A is available only for In the alternative, the executor may consent to elect the
that property (or part) in which qualified heirs of the decedent special lien provisions of section 6324A in lieu of the bond.
receive all of the successive interests, and such an election The IRS will contact you regarding the specifics of furnishing
must include the interests of all of those heirs. the bond or electing the special lien. The IRS will make this
determination on a case-by-case basis, and you may be
For example, if a surviving spouse receives a life estate in asked to provide additional information.
otherwise qualified property and the spouse's sibling
receives a remainder interest in fee, no part of the property If you elect the lien provisions, section 6324A requires that
may be valued under a section 2032A election. the lien be placed on property having a value equal to the
total deferred tax plus 4 years of interest. The property must
Where successive interests in specially valued property be expected to survive the deferral period, and does not
are created, remainder interests are treated as being necessarily have to be property of the estate. In addition, all
received by qualified heirs only if the remainder interests are people with an interest in the designated property must
not contingent on surviving a nonfamily member or are not consent to the creation of this lien.
subject to divestment in favor of a nonfamily member. Percentage requirements. To qualify for installment
payments, the value of the interest in the closely held
Protective Election business that is included in the gross estate must be more
than 35% of the adjusted gross estate (the gross estate less
You may make a protective election to specially value expenses, indebtedness, taxes, and losses—Schedules J, K,
qualified real property. Under this election, whether or not you and L of Form 706 (do not include any portion of the state
may ultimately use special-use valuation depends upon final death tax deduction)).
values (as shown on the return determined following Interests in two or more closely held businesses are
examination of the return) meeting the requirements of treated as an interest in a single business if at least 20% of
section 2032A. the total value of each business is included in the gross

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estate. For this purpose, include any interest held by the The partnership or corporation must be carrying on a trade
surviving spouse that represents the surviving spouse's or business at the time of the decedent's death. For further
interest in a business held jointly with the decedent as information on whether certain partnerships or corporations
community property or as joint tenants, tenants by the owning real property interests constitute a closely held
entirety, or tenants in common. business, see Rev. Rul. 2006-34, 2006-26 I.R.B. 1171,
Value. The value used for meeting the percentage available at Rev. Rul. 2006-34.
requirements is the same value used for determining the In determining the number of partners or shareholders, a
gross estate. Therefore, if the estate is valued under alternate partnership or stock interest is treated as owned by one
valuation or special-use valuation, you must use those values partner or shareholder if it is community property or held by
to meet the percentage requirements. spouses as joint tenants, tenants in common, or tenants by
Transfers before death. Generally, gifts made before the entirety.
death are not included in the gross estate. However, the Property owned directly or indirectly by or for a
estate must meet the 35% requirement by both including in corporation, partnership, estate, or trust is treated as owned
and excluding from the gross estate any gifts made by the proportionately by or for its shareholders, partners, or
decedent in the 3-year period ending on the date of death. beneficiaries. For trusts, only beneficiaries with present
Passive assets. In determining the value of a closely held interests are considered.
business and whether the 35% requirement is met, do not
include the value of any passive assets held by the business. The interest in a closely held farm business includes the
A passive asset is any asset not used in carrying on a trade interest in the residential buildings and related improvements
or business. Any asset used in a qualifying lending and occupied regularly by the owners, lessees, and employees
financing business is treated as an asset used in carrying on operating the farm.
a trade or business; see section 6166(b)(10) for details. Holding company stock. The executor may elect to treat
Stock in another corporation is a passive asset unless the as business company stock the portion of any holding
stock is treated as held by the decedent because of the company stock that represents direct ownership (or indirect
election to treat holding company stock as business ownership through one or more other holding companies) in
company stock; see Holding company stock, later. a business company. A holding company is a corporation
holding stock in another corporation. A business company is
If a corporation owns at least 20% in value of the voting a corporation carrying on a trade or business.
stock of another corporation, or the other corporation had no
more than 45 shareholders and at least 80% of the value of In general, this election applies only to stock that is not
the assets of each corporation is attributable to assets used readily tradable. However, the election can be made if the
in carrying on a trade or business, then these corporations business company stock is readily tradable, as long as all of
will be treated as a single corporation and the stock will not the stock of each holding company is not readily tradable.
be treated as a passive asset. Stock held in the other For purposes of the 20%-voting-stock requirement, stock
corporation is not taken into account in determining the 80% is treated as voting stock to the extent the holding company
requirement. owns voting stock in the business company.
Interest in a closely held business. For purposes of the If the executor makes this election, the first installment
installment payment election, an interest in a closely held payment is due when the estate tax return is filed. The 5-year
business means: deferral for payment of the tax, as discussed later under Time
• Ownership of a trade or business carried on as a for payment, does not apply. In addition, the 2% interest rate,
proprietorship; discussed later under Interest computation, will not apply.
• An interest as a partner in a partnership carrying on a Also, if the business company stock is readily tradable, as
trade or business, if 20% or more of the total capital explained above, the tax must be paid in five installments.
interest was included in the gross estate of the decedent Determine how much of the estate tax may be paid in in-
or the partnership had no more than 45 partners; or stallments under section 6166. To determine whether the
• Stock in a corporation carrying on a trade or business, if election may be made, you must figure the adjusted gross
20% or more in value of the voting stock of the estate. (See the Line 3 Worksheet—Adjusted Gross Estate
corporation is included in the gross estate of the below.) To determine the value of the adjusted gross estate,
decedent or the corporation had no more than 45 subtract the deductions (Schedules J, K, and L) from the
shareholders. value of the gross estate.
Line 3 Worksheet—Adjusted Gross Estate
1. Enter the value of the decedent's interest in closely held business(es) included in the gross estate (less value of
passive assets, as mentioned in section 6166(b)(9)) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
2. Enter the value of the gross estate (Form 706, Part 5, item 13) . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
3. Add items 18, 19, and 20 from Form 706, Part 5 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
4. Subtract line 3 from line 2 to figure the adjusted gross estate. . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
5. Divide line 1 by line 4 to figure the value the business interest bears to the value of the adjusted gross estate. For
purposes of this calculation, carry the decimal to the sixth place; the IRS will make this adjustment for purposes
of determining the correct amount. If this amount is less than 0.350000, the estate does not qualify to make the
election under section 6166 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
6. Multiply line 5 by the amount on line 16 of Form 706, Part 2. This is the maximum amount of estate tax that may
be paid in installments under section 6166. (Certain GST taxes may be deferred as well; see section 6166(i) for
more information.) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

Instructions for Form 706 (Rev. 10-2024) 15

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To determine over how many installments the estate tax The interest paid on installment payments is not
may be paid, please refer to sections 6166(a), (b)(7), (b)(8), ! deductible as an administrative expense of the
and (b)(10). CAUTION estate.

Time for payment. Under the installment method, the Making the election. If you check this line to make a final
executor may elect to defer payment of the qualified estate election, you must attach the notice of election described in
tax, but not interest, for up to 5 years from the original Regulations section 20.6166-1(b). If you check this line to
payment due date. After the first installment of tax is paid, make a protective election, you must attach a notice of
you must pay the remaining installments annually by the date protective election as described in Regulations section
1 year after the due date of the preceding installment. There 20.6166-1(d). Regulations section 20.6166-1(b) requires that
can be no more than 10 installment payments. the notice of election is made by attaching to a timely filed
Interest on the unpaid portion of the tax is not deferred and estate tax return the following information.
must be paid annually. Interest must be paid at the same time • The decedent's name and taxpayer identification number
as and as a part of each installment payment of the tax. (TIN) as they appear on the estate tax return.
Acceleration of payments. If the estate fails to make • The amount of tax that is to be paid in installments.
payments of tax or interest within 6 months of the due date, • The date selected for payment of the first installment.
the IRS may terminate the right to make installment payments • The number of annual installments, including first
and force an acceleration of payment of the tax upon notice installment, in which the tax is to be paid.
and demand. Upon notice and demand, a penalty will be • The properties shown on the estate tax return that are the
imposed for an amount that is 5% of the payment multiplied closely held business interest (identified by schedule and
by the number of months (or fractions thereof) after the due item number).
date and before the payment is made. • The facts that formed the basis for the executor's
conclusion that the estate qualifies for payment of the
Generally, if any portion of the interest in the closely held estate tax in installments.
business which qualifies for installment payments is
distributed, sold, exchanged, or otherwise disposed of, or You may also elect to pay certain GST taxes in
money and other property attributable to such an interest is installments. See section 6166(i).
withdrawn, and the aggregate of those events equals or
exceeds 50% of the value of the interest, then the right to Line 4. Reversionary or Remainder Interests
make installment payments will be terminated, and the For details of this election, see section 6163 and the related
unpaid portion of the tax will be due upon notice and regulations.
demand. See section 6166(g)(1)(A).
Interest computation. A special interest rate applies to Part 4—General Information
installment payments. For decedents dying in 2024, the
interest rate is 2% on the lesser of: Authorization
• $740,000, or Completing the authorization will authorize one attorney,
• The amount of the estate tax that is attributable to the accountant, or enrolled agent to represent the estate and
closely held business and that is payable in installments. receive confidential tax information, but will not authorize the
2% portion. The 2% portion is an amount equal to the representative to enter into closing agreements for the estate.
amount of the tentative estate tax (on $1 million plus the If you would like to authorize your representative to enter into
applicable exclusion amount in effect) minus the applicable agreements or perform other designated acts on behalf of the
credit amount in effect. However, if the amount of estate tax estate, you must file Form 2848 with Form 706.
extended under section 6166 is less than the amount figured
above, the 2% portion is the lesser amount. Note. If you intend for the representative to represent the
Inflation adjustment. The $1 million amount used to estate before the IRS, the representative must complete and
figure the 2% portion is indexed for inflation for the estates of sign this authorization.
decedents who died in a calendar year after 1998. For an Complete and attach Form 2848 if you would like to
estate of a decedent who died in 2024, the dollar amount authorize:
used to determine the “2% portion” of the estate tax payable • Persons other than attorneys, accountants, or enrolled
in installments under section 6166 is $1,850,000. agents to represent the estate;
Computation. Interest on the portion of the tax in excess • More than one person to receive confidential information
of the 2% portion is figured at 45% of the annual rate of or represent the estate; or
interest on underpayments. This rate is based on the federal • Someone to sign agreements, consents, waivers, or
short-term rate and is announced quarterly by the IRS in the other documents for the estate.
Internal Revenue Bulletin.
Filing a completed Form 2848 with this return may
If you elect installment payments and the estate tax due is expedite processing of the Form 706.
more than the maximum amount to which the 2% interest rate
applies, each installment payment is deemed to comprise If you wish only to authorize someone to inspect and/or
both tax subject to the 2% interest rate and tax subject to receive confidential tax information (but not to represent you
45% of the regular underpayment rate. The amount of each before the IRS), complete and file Form 8821.
installment that is subject to the 2% rate is the same as the
percentage of total tax payable in installments that is subject Line 3
to the 2% rate. Enter the marital status of the decedent at the time of death
by checking the appropriate box on line 3a. If the decedent
was married at the time of death, complete line 4. If the
decedent had one or more prior marriages, complete line 3b

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by providing the name and SSN of each former spouse, the determined, the protective claim must be filed before the end
date(s) the marriage ended, and specify whether the of the limitations period. For more information on how to file a
marriage ended by annulment, divorce decree, or death of protective claim for refund with this Form 706, see the
spouse. If the prior marriage ended in death and the instructions for Schedule PC, later.
predeceased spouse died after December 31, 2010,
complete Part 6—Portability of Deceased Spousal Unused Line 7. Section 2044 Property
Exclusion, Section D, if the estate of the predeceased If you answered “Yes,” these assets must be shown on
spouse elected to allow the decedent to use any unused Schedule F.
exclusion amount. For more information, see section 2010(c)
(4) and related regulations. Section 2044 property is property for which a previous
section 2056(b)(7) election (QTIP election) has been made,
Line 4 or for which a similar gift tax election (section 2523) has been
Complete line 4 whether or not there is a surviving spouse made. For more information, see the instructions for
and whether or not the surviving spouse received any Schedule F, later.
benefits from the estate. If there was no surviving spouse on
Line 9. Insurance Not Included in the Gross
the date of the decedent's death, enter “None” on line 4a and
leave lines 4b and 4c blank. The value entered on line 4c Estate
need not be exact. See Amount under line 5, later. If you answered “Yes” to either line 9a or 9b, for each policy
you must complete and attach Schedule D, Form 712, and an
Note. Do not include any DSUE amount transferred to the explanation of why the policy or its proceeds are not
surviving spouse in the total entered on line 4c. includible in the gross estate.

Line 5 Line 11. Partnership Interests and Stock in
Name. Enter the name of each individual, trust, or estate Close Corporations
that received (or will receive) benefits of $5,000 or more from If you answered “Yes” on line 11a, you must include full
the estate directly as an heir, next-of-kin, devisee, or legatee; details for partnerships (including family limited
or indirectly (for example, as beneficiary of an annuity or partnerships), unincorporated businesses, and limited liability
insurance policy, shareholder of a corporation, or partner of a companies (LLCs) on Schedule F (Schedule E if the
partnership that is an heir, etc.). partnership interest is jointly owned). Also include full details
Identifying number. Enter the SSN of each individual for fractional interests in real estate on Schedule A and for
beneficiary listed. If the number is unknown, or the individual stock of inactive or close corporations on Schedule B.
has no number, please indicate “unknown” or “none.” For Value these interests using the rules of Regulations
trusts and other estates, enter the employer identification section 20.2031-2 (stocks) or 20.2031-3 (other business
number (EIN). interests).
Relationship. For each individual beneficiary, enter the A close corporation is a corporation whose shares are
relationship (if known) to the decedent by reason of blood, owned by a limited number of shareholders. Often, one family
marriage, or adoption. For trust or estate beneficiaries, holds the entire stock issue. As a result, little, if any, trading of
indicate “TRUST” or “ESTATE.” the stock takes place. There is, therefore, no established
Amount. Enter the amount actually distributed (or to be market for the stock, and those sales that do occur are at
distributed) to each beneficiary including transfers during the irregular intervals and seldom reflect all the elements of a
decedent's life from Schedule G required to be included in representative transaction as defined by FMV.
the gross estate. The value to be entered need not be exact.
A reasonable estimate is sufficient. For example, where Line 13. Trusts
precise values cannot readily be determined, as with certain If you answered “Yes” on either line 13a or line 13b, attach a
future interests, a reasonable approximation should be copy of the trust instrument for each trust.
entered. The total of these distributions should approximate
Complete Schedule G if you answered “Yes” on line 13a
the amount of gross estate reduced by funeral and
and Schedule F if you answered “Yes” on line 13b.
administrative expenses, debts and mortgages, bequests to
surviving spouse, charitable bequests, and any federal and Line 15. Foreign Accounts
state estate and GST taxes paid (or payable) relating to the
benefits received by the beneficiaries listed on lines 4 and 5. Check “Yes” on line 15 if the decedent at the time of death
had an interest in or signature or other authority over a
All distributions of less than $5,000 to specific financial account in a foreign country, such as a bank
beneficiaries may be included with distributions to account, securities account, an offshore trust, or other
unascertainable beneficiaries on the line provided. financial account.
Line 6. Protective Claim for Refund
If you answered “Yes,” complete Schedule PC for each claim. Part 5—Recapitulation
Two copies of each Schedule PC must be filed with the
return. Gross Estate—Items 1 Through 11
A protective claim for refund may be filed when there is an Items 1 through 9. You must make an entry in each of items
unresolved claim or expense that will not be deductible under 1 through 9.
section 2053 before the expiration of the period of limitation If the gross estate does not contain any assets of the type
under section 6511(a). To preserve the estate's right to a specified by a given item, enter zero for that item. Entering
refund once the claim or expense has been finally zero for any of items 1 through 9 is a statement by the

Instructions for Form 706 (Rev. 10-2024) 17

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executor, made under penalties of perjury, that the gross Deductions—Items 14 Through 23
estate does not contain any includible assets covered by that
item. Items 14 through 22. Attach the appropriate schedules for
the deductions claimed.
Do not enter any amounts in the “Alternate value” column
unless you elected alternate valuation on Part 3—Elections Item 18. If item 17 is less than or equal to the value (at the
by the Executor, line 1. time of the decedent's death) of the property subject to
claims, enter the amount from item 17 on item 18.
Note. If estimating the value of one or more assets pursuant If the amount on item 17 is more than the value of the
to the special rule of Regulations section 20.2010-2(a)(7)(ii), property subject to claims, enter the greater of:
do not enter values for those assets in items 1 through 9. • The value of the property subject to claims, or
Total the estimated values for those assets and follow the • The amount actually paid at the time the return is filed.
instructions for item 10.
In no event should you enter more on item 18 than the
Which schedules to attach for items 1 through 9. You amount on item 17. See section 2053 and the related
must attach the following. regulations for more information.
• Schedule F. Answer its questions even if you report no
assets on it. Item 23. Under Regulations section 20.2010-2(a)(7)(ii), if
• Schedules A, B, and C, if the gross estate includes any the total value of the gross estate and adjusted taxable gifts
(1) Real Estate, (2) Stocks and Bonds, or (3) Mortgages, is less than the basic exclusion amount (see section 6018(a))
Notes, and Cash, respectively. and Form 706 is being filed only to elect portability of the
• Schedule D, if the gross estate includes any life DSUE amount, the estate is not required to report the value
insurance or if you answered “Yes” to question 9a of Part of certain property eligible for the marital or charitable
4—General Information. deduction. For this property being reported on Schedule M or
• Schedule E, if the gross estate contains any jointly O, enter on item 23 the amount from item 10.
owned property or if you answered “Yes” to question 10
of Part 4—General Information. Part 6—Portability of Deceased
• Schedule G, if the decedent made any of the lifetime
transfers to be listed on that schedule or if you answered Spousal Unused Exclusion (DSUE)
“Yes” to question 12 or 13a of Part 4—General Section 2010(c)(4) authorizes estates of decedents dying
Information. after December 31, 2010, to elect to transfer any unused
• Schedule H, if you answered “Yes” to question 14 of Part exclusion to the surviving spouse. The amount received by
4—General Information. the surviving spouse is called the deceased spousal unused
• Schedule I, if you answered “Yes” to question 16 of Part exclusion (DSUE) amount. If the executor of the decedent’s
4—General Information. estate elects transfer, or portability, of the DSUE amount, the
surviving spouse can apply the DSUE amount received from
Item 10. Under Regulations section 20.2010-2(a)(7)(ii), if the estate of the surviving spouse’s last deceased spouse
the total value of the gross estate and adjusted taxable gifts (defined later) against any tax liability arising from
is less than the basic exclusion amount (see section 6018(a)) subsequent lifetime gifts and transfers at death.
and Form 706 is being filed only to elect portability of the
DSUE amount, the estate is not required to report the value Note. A nonresident surviving spouse who is not a citizen of
of certain property eligible for the marital or charitable the United States may not take into account the DSUE
deduction. For this property being reported on Schedules A, amount of a deceased spouse, except to the extent allowed
B, C, D, E, F, G, H, and I, the executor must figure the best by treaty with the nonresident surviving spouse’s country of
estimate of the value. Do not include the estimated value on citizenship.
the line corresponding to the schedule on which the property
was reported. Instead, total the estimated value of the assets Last Deceased Spouse Limitation
subject to the special rule and enter on item 10 the amount The last deceased spouse is the most recently deceased
from the Table of Estimated Values, later, that corresponds to person who was married to the surviving spouse at the time
that total. of that person’s death. The identity of the last deceased
spouse is determined as of the day a taxable gift is made, or
Note. The special rule does not apply if the valuation of the
in the case of a transfer at death, the date of the surviving
asset is needed to determine the estate's eligibility for the
spouse's death. The identity of the last deceased spouse is
provisions of section 2032, 2032A, 2652(a)(3), or 6166, or
not impacted by whether the decedent's estate elected
any other provision of the Code or regulations.
portability or whether the last deceased spouse had any
Note. As applies to all other values reported on Form 706, DSUE amount available. Remarriage also does not affect the
estimates of the value of property subject to the special rule designation of the last deceased spouse and does not
of Regulations section 20.2010-2(a)(7)(ii) must result from prevent the surviving spouse from applying the DSUE
the executor’s exercise of due diligence and are subject to amount to taxable transfers.
penalties of perjury. When a taxable gift is made, the DSUE amount received
from the last deceased spouse is applied before the surviving
Exclusion—Item 12 spouse’s basic exclusion amount. A surviving spouse may
Item 12. Conservation easement exclusion. Complete use the DSUE amount of the last deceased spouse to offset
and attach Schedule U (along with any required attachments) the tax on any taxable transfer made after the deceased
to claim the exclusion on this line. spouse's death. A surviving spouse who has more than one
predeceased spouse is not precluded from using the DSUE
amount of each spouse in succession. A surviving spouse

18 Instructions for Form 706 (Rev. 10-2024)

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Table of Estimated Values
If the total estimated value of the assets But less than or equal to: Include this amount on lines 10 and 23:
eligible for the special rule under Reg. 
section 20.2010-2(a)(7)(ii) is more than:
              $0                           $250,000                   $250,000
              $250,000                     $500,000                   $500,000
              $500,000                     $750,000                   $750,000
              $750,000                     $1,000,000                 $1,000,000
$1,000,000                                 $1,250,000                 $1,250,000
$1,250,000                                 $1,500,000                 $1,500,000
$1,500,000                                 $1,750,000                 $1,750,000
$1,750,000                                 $2,000,000                 $2,000,000
$2,000,000                                 $2,250,000                 $2,250,000
$2,250,000                                 $2,500,000                 $2,500,000
$2,500,000                                 $2,750,000                 $2,750,000
$2,750,000                                 $3,000,000                 $3,000,000
$3,000,000                                 $3,250,000                 $3,250,000
$3,250,000                                 $3,500,000                 $3,500,000
$3,500,000                                 $3,750,000                 $3,750,000
$3,750,000                                 $4,000,000                 $4,000,000
$4,000,000                                 $4,250,000                 $4,250,000
$4,250,000                                 $4,500,000                 $4,500,000
$4,500,000                                 $4,750,000                 $4,750,000
$4,750,000                                 $5,000,000                 $5,000,000
$5,000,000                                 $5,250,000                 $5,250,000
$5,250,000                                 $5,500,000                 $5,500,000
$5,500,000                                 $5,750,000                 $5,750,000
$5,750,000                                 $6,000,000                 $6,000,000
$6,000,000                                 $6,250,000                 $6,250,000
$6,250,000                                 $6,500,000                 $6,500,000
$6,500,000                                 $6,750,000                 $6,750,000
$6,750,000                                 $7,000,000                 $7,000,000
$7,000,000                                 $7,250,000                 $7,250,000
$7,250,000                                 $7,500,000                 $7,500,000
$7,500,000                                 $7,750,000                 $7,750,000
$7,750,000                                 $8,000,000                 $8,000,000
$8,000,000                                 $8,250,000                 $8,250,000
$8,250,000                                 $8,500,000                 $8,500,000
$8,500,000                                 $8,750,000                 $8,750,000
$8,750,000                                 $9,000,000                 $9,000,000
$9,000,000                                 $9,250,000                 $9,250,000
$9,250,000                                 $9,500,000                 $9,500,000
$9,500,000                                 $9,750,000                 $9,750,000
$9,750,000                                 $10,000,000                $10,000,000
$10,000,000                                $10,250,000                $10,250,000
$10,250,000                                $10,500,000                $10,500,000
$10,500,000                                $10,750,000                $10,750,000
$10,750,000                                $11,000,000                $11,000,000

Instructions for Form 706 (Rev. 10-2024)                                                                                 19

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Table of Estimated Values (continued)
If the total estimated value of the assets But less than or equal to: Include this amount on lines 10 and 23:
eligible for the special rule under Reg.
section 20.2010-2(a)(7)(ii) is more than:
$11,000,000 $11,180,000 $11,180,000
$11,180,000 $11,400,000 $11,400,000
$11,400,000 $11,580,000 $11,580,000
$11,580,000 $11,700,000 $11,700,000
$11,700,000 $12,060,000 $12,060,000
$12,060,000 $12,920,000 $12,920,000
$12,920,000 $13,610,000 $13,610,000

may not use the sum of DSUE amounts from multiple When a surviving spouse applies the DSUE amount to a
predeceased spouses at one time nor may the DSUE amount lifetime gift or bequest at death, the IRS may examine any
of a predeceased spouse be applied after the death of a return of a predeceased spouse whose executor elected
subsequent spouse. portability to verify the allowable DSUE amount. The DSUE
amount may be adjusted or eliminated as a result of the
Making the Election examination; however, the IRS may only make an
A timely filed and complete Form 706 is required to elect assessment of additional tax on the return of the
portability of the DSUE amount to a surviving spouse. The predeceased spouse within the applicable limitations period
filing requirement applies to all estates of decedents under section 6501.
choosing to elect portability of the DSUE amount, regardless
of the size of the estate. A timely filed return is one that is Special Rule Where Value of Certain Property
filed on or before the due date of the return, including Not Required To Be Reported on Form 706
extensions. See Rev. Proc. 2022-32 (superseding Rev. Proc. The regulations provide that executors of estates who are not
2017-34) for the simplified procedures for late elections. otherwise required to file Form 706 under section 6018(a) do
The timely filing of a complete Form 706 with DSUE will be not have to report the value of certain property qualifying for
deemed a portability election if there is a surviving spouse. the marital or charitable deduction. For such property, the
The election is effective as of the decedent’s date of death, executor may estimate the value in good faith and with the
so the DSUE amount received by a surviving spouse may be due diligence to be afforded all assets includible in the gross
applied to any transfer occurring after the decedent’s death. estate. The amount reported on Form 706 will correspond to
A portability election is irrevocable, unless an adjustment or a range of dollar values and will be included in the value of
amendment to the election is made on a subsequent return the gross estate shown on Part 2—Tax Computation, line 1.
filed on or before the due date. See the instructions for Part 5—Recapitulation, items 10 and
23, earlier, for more details.
Note. Under Regulations section 20.2010-2(a)(5), the
executor of an estate of a nonresident decedent who was not Specific Instructions
a citizen of the United States at the time of death cannot Portability Election. If you intend to elect portability of the
make a portability election. DSUE amount, timely filing a complete Form 706 is all that is
If an executor is appointed, qualified, and acting with the required. Complete Section B if any assets of the estate are
United States on behalf of the decedent’s estate, only that being transferred to a qualified domestic trust and complete
executor may make or opt out of a portability election. If there Section C of this Part to figure the DSUE amount that will be
is no executor, see Regulations section 20.2010-2(a)(6)(ii). transferred to the surviving spouse.
Opting Out Section A. Opting Out of Portability. If you are filing Form
706 and do not wish to elect portability, then check the box
If an estate files a Form 706 but does not wish to make the indicated. Do not complete Section B or C.
portability election, the executor can opt out of the portability
election by checking the box indicated in Section A of this Section B. Portability and Qualified Domestic Trusts
Part. If no return is required under section 6018(a), not filing (QDOTs). A QDOT allows the estate of a decedent to
Form 706 will avoid making the election. bequeath property to a surviving spouse who is not a citizen
of the United States and still receive a marital deduction.
Figuring the DSUE Amount When property passes to a QDOT, estate tax is imposed
Regulations section 20.2010-2(b)(1) requires that a under section 2056A as distributions are made from the trust.
decedent's DSUE be figured on the estate tax return. The When a QDOT is established and there is a DSUE amount,
DSUE amount is the lesser of (a) the basic exclusion amount the executor of the decedent’s estate will determine a
in effect on the date of death of the decedent whose DSUE is preliminary DSUE amount for the purpose of electing
being figured, or (b) the decedent's applicable exclusion portability. This amount will decrease as section 2056A
amount less the amount on line 5 of Part 2—Tax Computation distributions are made. In estates with a QDOT, the DSUE
on the Form 706 for the estate of the decedent. Amounts on amount generally may not be applied against tax arising from
which gift taxes were paid are excluded from adjusted taxable lifetime gifts because it will not be available to the surviving
gifts for the purpose of this computation.

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spouse until it is finally determined, usually upon the death of decedent’s last deceased spouse. Add this amount to the
the surviving spouse or when the QDOT is terminated. amount from Part 1, column D, if any, to determine the
decedent’s total DSUE amount.
Note. If a surviving spouse who is not a citizen of the United
States becomes a citizen and the section 2056A tax no
longer applies to the assets of the QDOT, as of the date the Schedule A—Real Estate
surviving spouse becomes a U.S. citizen, the DSUE amount If any assets to which the special rule of Regulations
is considered final and is available for application by the ! section 20.2010-2(a)(7)(ii) applies are reported on
surviving spouse. See Regulations sections 20.2010-2(c)(4), CAUTION this schedule, do not enter any value in the last three
20.2010-3(c)(3), and 25.2505-2(d)(3). columns. See the instructions for Part 5—Recapitulation, item
Check the appropriate box in this section and see the 10, for information on how to estimate and report the value of
instructions for Schedule M if more information is needed these assets.
about QDOT.
If the total gross estate contains any real estate, complete
Section C. DSUE Amount Portable to Decedent's Surviv- Schedule A and file it with the return. On Schedule A, list real
ing Spouse. Complete Section C only if electing portability estate the decedent owned or had contracted to purchase.
of the DSUE amount to the surviving spouse. Number each parcel in the left-hand column.
On line 1, enter the decedent’s applicable exclusion Describe the real estate in enough detail so that the IRS
amount from Part 2—Tax Computation, line 9d. The can easily locate it for inspection and valuation. For each
applicable exclusion amount is the sum of the basic exclusion parcel of real estate, report the area and, if the parcel is
amount for the year of death, any DSUE amount received improved, describe the improvements. For city or town
from a predeceased spouse, if applicable, and any Restored property, report the street and number, ward, subdivision,
Exclusion Amount. block and lot, etc. For rural property, report the township,
Line 2 is reserved. range, landmarks, etc.
On line 3, enter the value of the cumulative lifetime gifts on
If any item of real estate is subject to a mortgage for which
which gift tax was paid or payable. This amount is figured on
the decedent's estate is liable, that is, if the indebtedness
line 6 of the Line 7 Worksheet, Part B, as the total of Row (r)
may be charged against other property of the estate that is
from the Line 7 Worksheet, Part A. Enter the amount as it
not subject to that mortgage, or if the decedent was
appears on line 6 of the Line 7 Worksheet, Part B.
personally liable for that mortgage, you must report the full
Figure the unused exclusion amount on line 9. The DSUE value of the property in the value column. Enter the amount of
amount available to the surviving spouse will be the lesser of the mortgage under “Description” on this schedule. The
this amount or the basic exclusion amount shown on Part unpaid amount of the mortgage may be deducted on
2—Tax Computation, line 9a. Enter the DSUE amount as Schedule K.
determined on line 10.
If the decedent’s estate is not liable for the amount of the
Section D. DSUE Amount Received From Predeceased mortgage, report only the value of the equity of redemption
Spouse(s). Complete Section D if the decedent was a (or value of the property less the indebtedness) in the value
surviving spouse who received a DSUE amount from one or column as part of the gross estate. Do not enter any amount
more predeceased spouses. less than zero. Do not deduct the amount of indebtedness on
Section D requests information on all DSUE amounts Schedule K.
received from the decedent’s last deceased spouse and any
previously deceased spouses. Each line in the chart should Also list on Schedule A real property the decedent
reflect a different predeceased spouse; enter the calendar contracted to purchase. Report the full value of the property
year(s) in column F. In Part 1, provide information on the and not the equity in the value column. Deduct the unpaid
decedent’s last deceased spouse. In Part 2, provide part of the purchase price on Schedule K.
information as requested if the decedent had any other Report the value of real estate without reducing it for
predeceased spouse whose executor made the portability homestead or other exemption, or the value of dower,
election. Any remaining DSUE amount which was not used curtesy, or a statutory estate created instead of dower or
prior to the death of a subsequent spouse is not considered curtesy.
in this calculation and cannot be applied against any taxable
transfer. In column E, total only the amounts of DSUE Explain how the reported values were determined and
received and used from spouses who died before the attach copies of any appraisals.

Instructions for Form 706 (Rev. 10-2024) 21

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Schedule A—Example 1
                           In this example, alternate valuation is not adopted; the date of death is January 1, 2024.
   Item                                                  Description                                                       Alternate Alternate Value at 
number                                                                                                                     valuation value     date of 
                                                                                                                           date                death
1       House and lot, 1921 William Street NW, Washington, DC (lot 6, square 481). Rent of $8,100 due at 
        the end of each quarter, February 1, May 1, August 1, and November 1. Value based on appraisal, 
        copy of which is attached  . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .                       $550,000
        Rent due on item 1 for quarter ending November 1, 2023, but not collected at date of death                 . . .                             8,100
        Rent accrued on item 1 for November and December 2023                . . . . . . . . . . . . . . . . . . . . . .                             5,400
2       House and lot, 304 Jefferson Street, Alexandria, VA (lot 18, square 40). Rent of $1,800 payable 
        monthly. Value based on appraisal, copy of which is attached           . . . . . . . . . . . . . . . . . . . . .                            375,000
        Rent due on item 2 for December 2023, but not collected at death             . . . . . . . . . . . . . . . . . .                             1,800

Schedule A—Example 2
                             In this example, alternate valuation is adopted; the date of death is January 1, 2024.
  Item                                                   Description                                                       Alternate Alternate Value at 
number                                                                                                                     valuation value     date of 
                                                                                                                           date                death
1       House and lot, 1921 William Street NW, Washington, DC (lot 6, square 481). Rent of $8,100 due at 
        the end of each quarter, February 1, May 1, August 1, and November 1. Value based on appraisal, 
        copy of which is attached. Not disposed of within 6 months of date of death. . . . . . . . . . . . .               7/1/24    $535,000  $550,000
        Rent due on item 1 for quarter ending November 1, 2023, but not collected until February 1, 
        2024 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2/1/24    8,100           8,100
        Rent accrued on item 1 for November and December 2023, collected on February 1, 2024                     . . . .   2/1/24    5,400           5,400
2       House and lot, 304 Jefferson Street, Alexandria, VA (lot 18, square 40). Rent of $1,800 payable 
        monthly. Value based on appraisal, copy of which is attached. Property exchanged for farm on May 
        1, 2024 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .  5/1/24    369,000        375,000
        Rent due on item 2 for December 2023, but not collected until February 1, 2024 . . . . . . . . . .                 2/1/24    1,800           1,800

                                                                                         though some of the property will be shown on line 2 when the 
Schedule A-1—Section 2032A                                                               additional notice of election is subsequently filed.
Valuation                                                                                    You don’t need to complete columns B through D of lines 3 
                                                                                         and 4 or any other line entries on Schedule A-1.
The election to value certain farm and closely held business 
property at its special-use value is made by checking “Yes”                                  Completing Schedule A-1 as described above constitutes 
on Form 706, Part 3—Elections by the Executor, line 2.                                   a Notice of Protective Election as described in Regulations 
Schedule A-1 is used to report the additional information that                           section 20.2032A-8(b).
must be submitted to support this election. In order to make a 
valid election, you must complete Schedule A-1 and attach                                Part 2. Notice of Election
all of the required statements and appraisals.                                           Line 10.      Because the special-use valuation election creates 
                                                                                         a potential tax liability for the recapture tax of section 
  For definitions and additional information concerning                                  2032A(c), you must list each person who receives an interest 
special-use valuation, see section 2032A and the related                                 in the specially valued property on Schedule A-1. If there are 
regulations.                                                                             more than eight persons who receive interests, use an 
                                                                                         additional sheet that follows the format of line 10. In the 
Part 1. Type of Election                                                                 columns “Fair market value” and “Special-use value,” enter 
Estate and GST tax elections.          If you elect special-use                          the total respective values of all the specially valued property 
valuation for the estate tax, you must also elect special-use                            interests received by each person.
valuation for the GST tax and vice versa.
                                                                                         GST Tax Savings
Protective election.   To make the protective election 
                                                                                         To figure the additional GST tax due upon disposition (or 
described in the separate instructions for Part 3—Elections 
                                                                                         cessation of qualified use) of the property, each “skip person” 
by the Executor, line 2, you must complete the following.
                                                                                         (as defined in the instructions for Schedule R) who receives 
•  Check the box in Part 1. Type of Election.
                                                                                         an interest in the specially valued property must know the 
•  Enter the decedent's name and SSN in the spaces 
                                                                                         total GST tax savings all interests in specially valued property 
   provided at the top of Schedule A-1.
                                                                                         received. The GST tax savings is the difference between the 
•  Complete  Part 2. Notice of Election, line 1, and column A 
                                                                                         total GST tax that was imposed on all interests in specially 
   for lines 3 and 4.
                                                                                         valued property received by the skip person valued at their 
  For purposes of the protective election, list on line 3 all of                         special-use value and the total GST tax that would have been 
the real property that passes to the qualified heirs even 

22                                                                                                                     Instructions for Form 706 (Rev. 10-2024)

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imposed on the same interests received by the skip person in the property or when only an undivided interest is
had they been valued at their FMV. specially valued; and
• Trustees of trusts and representatives of other entities
Because the GST tax depends on the executor's holding title to or any interests in the property.
allocation of the GST exemption and the grandchild
exclusion, the skip person who receives the interests is An heir who has the power under local law to challenge a will
unable to figure this GST tax savings. Therefore, for each and thereby affect disposition of the property is not, however,
skip person who receives an interest in specially valued considered to be a person with an interest in property under
property, you must attach a calculation of the total GST tax section 2032A solely by reason of that right. Likewise,
savings attributable to that person's interests in specially creditors of an estate are not such persons solely by reason
valued property. of their status as creditors.
How to figure the GST tax savings. Before figuring each If persons required to enter into the agreement desire that
skip person's GST tax savings, complete Schedules R and an agent act for them or cannot legally bind themselves due
R-1 for the entire estate (using the special-use values). to infancy or other incompetency, or due to death before the
election under section 2032A is timely exercised, a
For each skip person, complete two Schedules R (Parts 2
representative authorized by local law to bind persons in
and 3 only) as worksheets, one showing the interests in
agreements of this nature may sign the agreement on the
specially valued property received by the skip person at their
person’s behalf.
special-use value and one showing the same interests at
their FMV. The IRS will contact the agent designated in the
If the skip person received interests in specially valued agreement on all matters relating to continued qualification
property that were shown on Schedule R-1, show these under section 2032A of the specially valued real property and
interests on the Schedule R, Parts 2 and 3 worksheets, as on all matters relating to the special lien arising under section
appropriate. Do not use Schedule R-1 as a worksheet. 6324B. It is the duty of the agent as attorney-in-fact for the
Completing the special-use value worksheets. On parties with interests in the specially valued property to
Schedule R, Parts 2 and 3, lines 2 through 4 and 6, enter -0-. furnish the IRS with any requested information and to notify
the IRS of any disposition or cessation of qualified use of any
Completing the fair market value worksheets. part of the property.
• Schedule R, Parts 2 and 3, lines 2 and 3, fixed taxes and
other charges. If valuing the interests at FMV (instead of Checklist for Section 2032A Election
special-use value) causes any of these taxes and
charges to increase, enter the increased amount (only) When making the special-use valuation election on
on these lines and attach an explanation of the increase. ! Schedule A-1, please use this checklist to ensure
Otherwise, enter -0-. CAUTION that you are providing everything necessary to make
• Schedule R, Parts 2 and 3, line 6—GST exemption a valid election.
allocation. If you completed Schedule R, Part 1, line 10, To have a valid special-use valuation election under
enter on line 6 the amount shown for the skip person on section 2032A, you must file, in addition to the federal estate
the line 10 special-use allocation schedule you attached tax return, (a) a notice of election (Schedule A-1, Part 2), and
to Schedule R. If you did not complete Schedule R, Part (b) a fully executed agreement (Schedule A-1, Part 3). You
1, line 10, enter -0- on line 6. must include certain information in the notice of election. To
Total GST tax savings. For each skip person, subtract the ensure that the notice of election includes all of the
tax amount on line 10, Part 2, of the special-use value information required for a valid election, use the following
worksheet from the tax amount on line 10, Part 2, of the fair checklist. The checklist is for your use only. Do not file it with
market value worksheet. This difference is the skip person's the return.
total GST tax savings.
Part 3. Agreement to Special Valuation Under Does the notice of election include the decedent's
Section 2032A name and SSN as they appear on the estate tax
The agreement to special valuation is required under return?
sections 2032A(a)(1)(B) and (d)(2) and must be signed by all
parties who have any interest in the property being valued Does the notice of election include the relevant
based on its qualified use as of the date of the decedent's qualified use of the property to be specially valued?
death.
Does the notice of election describe the items of
An interest in property is an interest that, as of the date of
the decedent's death, can be asserted under applicable law real property shown on the estate tax return that are
so as to affect the disposition of the specially valued property to be specially valued and identify the property by
by the estate. Any person who at the decedent's death has the Form 706 schedule and item number?
any such interest in the property, whether present, future,
vested, or contingent, must enter into the agreement. Does the notice of election include the FMV of the
Included are the following. real property to be specially valued and also include
• Owners of remainder and executory interests; its value based on the qualified use (determined
• Holders of general or special powers of appointment; without the adjustments provided in section
• Beneficiaries of a gift over in default of exercise of any 2032A(b)(3)(B))?
such power;
• Joint tenants and holders of similar undivided interests
when the decedent held only a joint or undivided interest

Instructions for Form 706 (Rev. 10-2024) 23

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   Does the notice of election include the adjusted 
   value (as defined in section 2032A(b)(3)(B)) of (a)     (In the case of an election made for qualified woodlands, 
   all real property that both passes from the decedent    the information included in the notice of election must 
   and is used in a qualified use, without regard to       include the reason for entitlement to the woodlands 
   whether it is to be specially valued; and (b) all real  election.)
   property to be specially valued?

   Does the notice of election include (a) the items of    Any election made under section 2032A will not be valid 
   personal property shown on the estate tax return        unless a properly executed agreement (Schedule A-1, Part 3) 
   that pass from the decedent to a qualified heir, and    is filed with the estate tax return. To ensure that the 
   that are used in qualified use; and (b) the total value agreement satisfies the requirements for a valid election, use 
   of such personal property adjusted under section        the following checklist. The checklist is for your use only. Do 
   2032A(b)(3)(B)?                                         not file it with the return.

   Does the notice of election include the adjusted          Has the agreement been signed by each qualified 
   value of the gross estate? (See section 2032A(b)(3)       heir having an interest in the property being 
   (A).)                                                     specially valued?

   Does the notice of election include the method used       Has every qualified heir expressed consent to 
   to determine the special-use value?                       personal liability under section 2032A(c) in the 
                                                             event of an early disposition or early cessation of 
   Does the notice of election include copies of written     qualified use?
   appraisals of the FMV of the real property?
                                                             Is the agreement that is actually signed by the 
   Does the notice of election include a statement that      qualified heirs in a form that is binding on all of the 
   the decedent and/or a member of the decedent’s            qualified heirs having an interest in the specially 
   family has owned all of the specially valued property     valued property?
   for at least 5 years of the 8 years immediately 
   preceding the date of the decedent's death?               Does the agreement designate an agent to act for 
                                                             the parties to the agreement in all dealings with the 
   Does the notice of election include a statement as to     IRS on matters arising under section 2032A?
   whether there were any periods during the 8-year 
   period preceding the decedent's date of death             Has the agreement been signed by the designated 
   during which the decedent or a member of the              agent and does it give the address of the agent?
   decedent’s family did not (a) own the property to be 
   specially valued, (b) use it in a qualified use, or (c) 
   materially participate in the operation of the farm or 
   other business? (See section 2032A(e)(6).)              Schedule B—Stocks and Bonds
                                                                   If any assets to which the special rule of Regulations 
   Does the notice of election include, for each item of   !       section 20.2010-2(a)(7)(ii) applies are reported on 
   specially valued property, the name of every person     CAUTION this schedule, do not enter any value in the last three 
   who has an interest in that item of specially valued    columns. See the instructions for Part 5—Recapitulation, item 
   property and the following information about each       10, for information on how to estimate and report the value of 
   such person: (a) the person's address, (b) the          these assets.
   person's TIN, (c) the person's relationship to the 
   decedent, and (d) the value of the property interest            Before completing Schedule B, see the examples 
   passing to that person based on both FMV and            TIP     illustrating the alternate valuation dates being 
                                                                   adopted and not being adopted, later.
   qualified use?
                                                           If the total gross estate contains any stocks or bonds, you 
   Does the notice of election include affidavits          must complete Schedule B and file it with the return.
   describing the activities constituting material         On Schedule B, list the stocks and bonds included in the 
   participation and the identities of the material        decedent's gross estate. Number each item in the left-hand 
   participants?                                           column.
   Does the notice of election include a legal             Note. Unless specifically exempted by an estate tax 
   description of each item of specially valued            provision of the Code, bonds that are exempt from federal 
   property? (Note. The legal description must be the      income tax are not exempt from estate tax. You should list 
                                                           these bonds on Schedule B.
   complete legal description of the property. An 
   abbreviated description is not sufficient.)             Public housing bonds includible in the gross estate must 
                                                           be included at their full value.

24                                                                      Instructions for Form 706 (Rev. 10-2024)

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Schedule B Examples
       Example showing use of Schedule B where the alternate valuation is not adopted; date of death, January 1, 2024.
Item   Description, including face amount of bonds or number of shares and par value              Unit value      Alternate     Alternate      Value at 
number where needed for identification. Give CUSIP number. If trust, partnership, or                              valuation     value          date of 
                                      closely held entity, give EIN.                                              date                         death
                                                                                  CUSIP number or 
                                                                                  EIN, where 
                                                                                  applicable
1      $60,000—Arkansas Railroad Co. first mortgage 4%, 20-year 
       bonds, due 2025. Interest payable quarterly on Feb. 1, May 1, 
       Aug. 1, and Nov. 1; N.Y. Exchange      . . . . . . . . . . . . . . . . .   XXXXXXXXX          100          - - - - - - - $- - - - - - - $ 60,000
       Interest coupons attached to bonds, item 1, due and payable on 
       Nov. 1, 2023, but not cashed at date of death . . . . . . . . . . .                          - - - - - - - - - - - - - - - - - - - - -  600
       Interest accrued on item 1, from Nov. 1, 2023, to Jan. 1, 
       2024 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .                   - - - - - - - - - - - - - - - - - - - - -  400
2      500 shares Public Service Corp., common; N.Y. Exchange               . .   XXXXXXXXX          110          - - - - - - - - - - - - - -  55,000
       Dividend on item 2 of $2 per share declared Dec. 10, 2023, 
       payable on Jan. 9, 2024, to holders of record on Dec. 30, 
       2023 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .                   - - - - - - - - - - - - - - - - - - - - -  1,000

               Example showing use of Schedule B where the alternate valuation is adopted; date of death, January 1, 2024.
Item   Description, including face amount of bonds or number of shares and par value              Unit value      Alternate     Alternate      Value at 
number where needed for identification. Give CUSIP number. If trust, partnership, or                              valuation     value          date of 
                                      closely held entity, give EIN.                                              date                         death
                                                                                  CUSIP number or 
                                                                                  EIN, where 
                                                                                  applicable
1      $60,000—Arkansas Railroad Co. first mortgage 4%, 20-year 
       bonds, due 2025. Interest payable quarterly on Feb. 1, May 1, 
       Aug. 1, and Nov. 1; N.Y. Exchange . . . . . . . . . . . . . . . . .        XXXXXXXXX          100          - - - - - -   $- - - - - -   $ 60,000
       $30,000 of item 1 distributed to legatees on Apr. 1, 2024 . . . .                             99           4/1/24        29,700         - - - - - - 
       $30,000 of item 1 sold by executor on May 1, 2024          . . . . . . .                      98           5/1/24        29,400         - - - - - - 
       Interest coupons attached to bonds, item 1, due and payable on 
       Nov. 1, 2023, but not cashed at date of death. Cashed by executor 
       on Feb. 2, 2024  . . . . . . . . . . . . . . . . . . . . . . . . . . . .                     - - - - - -   2/2/24        600            600
       Interest accrued on item 1, from Nov. 1, 2023, to Jan. 1, 2024. 
       Cashed by executor on Feb. 2, 2024 . . . . . . . . . . . . . . . .                           - - - - - -   2/2/24        400            400
2      500 shares Public Service Corp., common; N.Y. Exchange             . . .   XXXXXXXXX          110          - - - - - -   - - - - - -    55,000
       Not disposed of within 6 months following death . . . . . . . . .                             90           7/1/24        45,000         - - - - - - 
       Dividend on item 2 of $2 per share declared Dec. 10, 2023, paid 
       on Jan. 9, 2024, to holders of record on Dec. 30, 2023         . . . . .                     - - - - - -   1/9/24        1,000          1,000

If you paid any estate, inheritance, legacy, or succession                        of record on a date after the decedent's death are not 
tax to a foreign country on any stocks or bonds included in                       includible in the gross estate for federal estate tax purposes 
this schedule, group those stocks and bonds together and                          and should not be listed here.
label them “Subjected to Foreign Death Taxes.”
                                                                                  Description
List interest and dividends on each stock or bond on a 
separate line.                                                                    Stocks. For stocks, indicate:
                                                                                  • Number of shares;
Indicate as a separate item dividends that have not been                          • Whether common or preferred;
collected at death and are payable to the decedent or the                         • Issue;
estate because the decedent was a stockholder of record on                        • Par value where needed for identification;
the date of death. However, if the stock is being traded on an                    • Price per share;
exchange and is selling ex-dividend on the date of the                            • Exact name of corporation;
decedent's death, do not include the amount of the dividend                       • Principal exchange upon which sold, if listed on an 
as a separate item. Instead, add it to the ex-dividend                              exchange; and
quotation in determining the FMV of the stock on the date of                      • Nine-digit CUSIP number (defined later).
the decedent's death. Dividends declared on shares of stock 
before the death of the decedent but payable to stockholders 

Instructions for Form 706 (Rev. 10-2024)                                                                                                               25

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Bonds. For bonds, indicate: If only closing prices for bonds are available, see
• Quantity and denomination; Regulations section 20.2031-2(b).
• Name of obligor; Apply the rules in the section 2031 regulations to
• Date of maturity; determine the value of inactive stock and stock in close
• Interest rate; corporations. Attach to Schedule B complete financial and
• Interest due date; other data used to determine value, including balance sheets
• Principal exchange, if listed on an exchange; and (particularly the one nearest to the valuation date) and
• Nine-digit CUSIP number. statements of the net earnings or operating results and
If the stock or bond is unlisted, show the company's dividends paid for each of the 5 years immediately before the
principal business office. valuation date.
If the gross estate includes any interest in a trust, Securities reported as of no value, of nominal value, or
partnership, or closely held entity, provide the EIN of the obsolete should be listed last. Include the address of the
entity in the description column on Schedules B, E, F, G, M, company and the state and date of incorporation. Attach
and O. You must also provide the EIN of an estate (if any) in copies of correspondence or statements used to determine
the description column on the above-noted schedules, where the “no value.”
applicable. If the security was listed on more than one stock
CUSIP number. The CUSIP (Committee on Uniform exchange, use either the records of the exchange where the
Security Identification Procedures) number is a nine-digit security is principally traded or the composite listing of
number that is assigned to all stocks and bonds traded on combined exchanges, if available, in a publication of general
major exchanges and many unlisted securities. Usually, the circulation. In valuing listed stocks and bonds, you should
CUSIP number is printed on the face of the stock certificate. carefully check accurate records to obtain values for the
If you do not have a stock certificate, the CUSIP may be applicable valuation date.
found on the broker's or custodian's statement or by If you get quotations from brokers, or evidence of the sale
contacting the company's transfer agent. of securities from the officers of the issuing companies,
attach to the schedule copies of the letters furnishing these
Valuation quotations or evidence of sale.
List the FMV of the stocks or bonds. The FMV of a stock or
bond (whether listed or unlisted) is the mean between the
highest and lowest selling prices quoted on the valuation Schedule C—Mortgages, Notes, and
date. If only the closing selling prices are available, then the Cash
FMV is the mean between the quoted closing selling price on
the valuation date and on the trading day before the valuation If any assets to which the special rule of Regulations
date. ! section 20.2010-2(a)(7)(ii) applies are reported on
CAUTION this schedule, do not enter any value in the last three
If there were no sales on the valuation date, figure the columns. See the instructions for Part 5—Recapitulation, item
FMV as follows. 10, for information on how to estimate and report the value of
these assets.
1. Find the mean between the highest and lowest selling
prices on the nearest trading date before and the nearest Complete Schedule C and file it with your return if the total
trading date after the valuation date. Both trading dates gross estate contains any:
must be reasonably close to the valuation date. • Mortgages,
2. Prorate the difference between the mean prices to the • Notes, or
valuation date. • Cash.
3. Add or subtract (whichever applies) the prorated part of List on Schedule C:
the difference to or from the mean price figured for the • Mortgages and notes payable to the decedent at the
nearest trading date before the valuation date. time of death, and
• Cash the decedent had at the date of death.
If no actual sales were made reasonably close to the
valuation date, make the same computation using the mean Note. Do not list mortgages and notes payable by the
between the bona fide bid and asked prices instead of sales decedent on Schedule C. (If these are deductible, list them
prices. If actual sales prices or bona fide bid and asked on Schedule K.)
prices are available within a reasonable period of time before Schedule C reporting order. List the items on Schedule C
the valuation date but not after the valuation date, or vice in the following order.
versa, use the mean between the highest and lowest sales
prices or bid and asked prices as the FMV. 1. Mortgages.
For example, assume that sales of stock nearest the 2. Promissory notes.
valuation date (June 15) occurred 2 trading days before 3. Contracts by decedent to sell land.
(June 13) and 3 trading days after (June 18). On those days,
the mean sale prices per share were $10 and $15, 4. Cash in possession.
respectively. Therefore, the price of $12 is considered the 5. Cash in banks, savings and loan associations, and other
FMV of a share of stock on the valuation date. If, however, on types of financial organizations.
June 13 and 18, the mean sale prices per share were $15
and $10, respectively, the FMV of a share of stock on the
valuation date is $13.

26 Instructions for Form 706 (Rev. 10-2024)

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Description • Insurance on the decedent's life receivable by
beneficiaries other than the estate, as described below.
Mortgages. For mortgages, list:
The term “insurance” refers to life insurance of every
• Face value, description, including death benefits paid by fraternal
• Unpaid balance, beneficiary societies operating under the lodge system, and
• Date of mortgage, death benefits paid under no-fault automobile insurance
• Name of maker, policies if the no-fault insurer was unconditionally bound to
• Property mortgaged, pay the benefit in the event of the insured's death.
• Date of maturity,
• Interest rate, and Insurance in favor of the estate. Include on Schedule D
• Interest date. the full amount of the proceeds of insurance on the life of the
decedent receivable by the executor or otherwise payable to
Mortgage description example. “Bond and mortgage of
or for the benefit of the estate. Insurance in favor of the estate
$50,000, unpaid balance: $17,000; dated: January 1, 1992;
includes insurance used to pay the estate tax, and any other
J. Doe to R. Roe; premises: 22 Clinton Street, Newark, NJ;
taxes, debts, or charges that are enforceable against the
due: January 1, 2024; interest payable at 10% a
estate. The manner in which the policy is drawn is immaterial
year—January 1 and July 1.”
as long as there is an obligation, legally binding on the
Promissory notes. For promissory notes, list in the same beneficiary, to use the proceeds to pay taxes, debts, or
way as mortgages. charges. You must include the full amount even though the
Contracts by the decedent to sell land. For contracts by premiums or other consideration may have been paid by a
the decedent to sell land, list: person other than the decedent.
• Name of purchaser, Insurance receivable by beneficiaries other than the es-
• Contract date, tate. Include on Schedule D the proceeds of all insurance on
• Property description, the life of the decedent not receivable by, or for the benefit of,
• Sale price, the decedent's estate if the decedent possessed at death
• Initial payment, any of the following incidents of ownership, exercisable either
• Amounts of installment payment, alone or in conjunction with any person or entity.
• Unpaid balance of principal, and Incidents of ownership in a policy include the following.
• Interest rate. • The right of the insured or estate to its economic benefits.
Cash in possession. For cash on hand, list such cash • The power to change the beneficiary.
separately from bank deposits. • The power to surrender or cancel the policy.
• The power to assign the policy or to revoke an
Cash in financial organizations. For cash in banks, assignment.
savings and loan associations, and other types of financial • The power to pledge the policy for a loan.
organizations, list: • The power to obtain from the insurer a loan against the
• Name and address of each financial organization; surrender value of the policy.
• Amount in each account; • A reversionary interest if the value of the reversionary
• Serial or account number; interest was more than 5% of the value of the policy
• Nature of account—checking, savings, time deposit, etc.; immediately before the decedent died. (An interest in an
and insurance policy is considered a reversionary interest if,
• Unpaid interest accrued from date of last interest for example, the proceeds become payable to the
payment to the date of death. insured's estate or payable as the insured directs if the
beneficiary dies before the insured.)
Note. If you obtain statements from the financial
organizations, keep them for IRS inspection. Life insurance not includible in the gross estate under
section 2042 may be includible under some other section of
the Code. For example, a life insurance policy could be
Schedule D—Insurance on the transferred by the decedent in such a way that it would be
Decedent's Life includible in the gross estate under section 2036, 2037, or
2038. See the instructions for Schedule G for a description of
If any assets to which the special rule of Regulations these sections.
! section 20.2010-2(a)(7)(ii) applies are reported on
CAUTION this schedule, do not enter any value in the last three Completing the Schedule
columns. See the instructions for Part 5—Recapitulation, item You must list every insurance policy on the life of the
10, for information on how to estimate and report the value of decedent, whether or not it is included in the gross estate.
these assets.
Under “Description,” list:
If you are required to file Form 706 and there was any
insurance on the decedent's life, whether or not included in • The name of the insurance company, and
the gross estate, you must complete Schedule D and file it • The number of the policy.
with the return. For every life insurance policy listed on the schedule,
Insurance you must include on Schedule D. Under request a statement on Form 712 from the company that
section 2042, you must include in the gross estate: issued the policy. Attach the Form 712 to Schedule D.
• Insurance on the decedent's life receivable by or for the
benefit of the estate; and Note. If the insurance company that issued the policy will not
provide Form 712, you should attach evidence that verifies
the amount includible on Schedule D, including but not

Instructions for Form 706 (Rev. 10-2024) 27

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limited to an attachment, rider, assignment, copy of insurance For each item of property, enter the appropriate letter A, B,
proceeds check, and other relevant material. C, etc., from line 2a to indicate the name and address of the
surviving co-tenant.
If the policy proceeds are paid in one sum, enter the net
proceeds received (from Form 712, line 24) in the value (and Under “Description,” describe the property as required in
alternate value) columns of Schedule D. If the policy the instructions for Schedules A, B, C, and F for the type of
proceeds are not paid in one sum, enter the value of the property involved.
proceeds as of the date of the decedent's death (from Form In the “Percentage includible” column, enter the
712, line 25). percentage of the total value of the property included in the
gross estate.
If part or all of the policy proceeds are not included in the
gross estate, explain why they were not included. Generally, you must include the full value of the jointly
owned property in the gross estate. However, the full value
should not be included if you can show that a part of the
Schedule E—Jointly Owned Property property originally belonged to the other tenant(s) and was
never received or acquired by the other tenant(s) from the
If any assets to which the special rule of Regulations
decedent for less than adequate and full consideration in
! section 20.2010-2(a)(7)(ii) applies are reported on money or money's worth. Full value of jointly owned property
CAUTION this schedule, do not enter any value in the last three
also does not have to be included in the gross estate if you
columns. See the instructions for Part 5—Recapitulation, item
can show that any part of the property was acquired with
10, for information on how to estimate and report the value of
consideration originally belonging to the surviving joint
these assets.
tenant(s). In this case, you may exclude from the value of the
If you are required to file Form 706, complete Schedule E property an amount proportionate to the consideration
and file it with the return if the decedent owned any joint furnished by the other tenant(s). Relinquishing or promising
property at the time of death, whether or not the decedent's to relinquish dower, curtesy, or statutory estate created
interest is includible in the gross estate. instead of dower or curtesy, or other marital rights in the
decedent's property or estate is not consideration in money
Enter on this schedule all property of whatever kind or or money's worth. See the Schedule A instructions for the
character, whether real estate, personal property, or bank value to show for real property that is subject to a mortgage.
accounts, in which the decedent held at the time of death an
interest either as a joint tenant with right to survivorship or as If the property was acquired by the decedent and another
a tenant by the entirety. person or persons by gift, bequest, devise, or inheritance as
joint tenants, and their interests are not otherwise specified
Do not list on this schedule property that the decedent by law, include only that part of the value of the property that
held as a tenant in common, but report the value of the is figured by dividing the full value of the property by the
interest on Schedule A if real estate, or on the appropriate number of joint tenants.
schedule if personal property. Similarly, community property If you believe that less than the full value of the entire
held by the decedent and spouse should be reported on the property is includible in the gross estate for tax purposes, you
appropriate Schedules A through I. The decedent's interest in must establish the right to include the smaller value by
a partnership should not be entered on this schedule unless attaching proof of the extent, origin, and nature of the
the partnership interest itself is jointly owned. Solely owned decedent's interest and the interest(s) of the decedent's
partnership interests should be reported on Schedule F. co-tenant(s).
Part 1. Qualified joint interests held by decedent and In the “Includible alternate value” and “Includible value at
spouse. Under section 2040(b)(2), a joint interest is a date of death” columns, enter only the values that you believe
qualified joint interest if the decedent and the surviving are includible in the gross estate.
spouse held the interest as:
• Tenants by the entirety, or
• Joint tenants with right of survivorship if the decedent Schedule F—Other Miscellaneous
and the decedent's spouse are the only joint tenants. Property
Interests that meet either of the two requirements above If any assets to which the special rule of Regulations
should be entered in Part 1. Joint interests that do not meet ! section 20.2010-2(a)(7)(ii) applies are reported on
either of the two requirements above should be entered in CAUTION this schedule, do not enter any value in the last three
Part 2. columns. See the instructions for Part 5—Recapitulation, item
Under “Description,” describe the property as required in 10, for information on how to estimate and report the value of
the instructions for Schedules A, B, C, and F for the type of these assets.
property involved. For example, jointly held stocks and bonds
should be described using the rules given in the instructions You must complete Schedule F and file it with the re-
for Schedule B. turn. On Schedule F, list all items that must be included in
Under “Alternate value” and “Value at date of death,” enter the gross estate that are not reported on any other schedule,
the full value of the property. including:
• Debts due the decedent (other than notes and
Note. You cannot claim the special treatment under section mortgages included on Schedule C);
2040(b) for property held jointly by a decedent and a • Interests in business;
surviving spouse who is not a U.S. citizen. Report these joint • Any interest in an Archer medical savings account (MSA)
interests on Part 2 of Schedule E, not Part 1. or health savings account (HSA), unless such interest
passes to the surviving spouse;
Part 2. All other joint interests. All joint interests that were
not entered in Part 1 must be entered in Part 2.

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• Insurance on the life of another (obtain and attach Form Example of effective discount:
712, for each policy) (see Note below);
• Section 2044 property (see Decedent Who Was a a Pro-rata value of LLC (before any discounts) $100.00
Surviving Spouse, later);
• Claims (including the value of the decedent's interest in a b Minus: 10% discounts for lack of control (10.00)
claim for refund of income taxes or the amount of the c Marketable minority interest value (as if freely traded
refund actually received); minority interest value) $90.00
• Rights; d Minus: 15% discount for lack of marketability (13.50)
• Digital assets are any digital representations of value that
are recorded on a cryptographically secured distributed e Nonmarketable minority interest value $76.50
ledger or any similar technology. For example, digital
assets include non-fungible tokens (NFTs) and virtual Calculation of effective discount:
currencies, such as cryptocurrencies and stablecoins. If
a particular asset has the characteristics of a digital ( minus ) divided by = effective discounta e a
asset, it will be treated as a digital asset for federal
transfer tax purposes; ($100.00 - $76.50) ÷ $100.00 = 23.50%
• Royalties;
• Leaseholds; Note. The amount of discounts are based on the factors
• Judgments; pertaining to a specific interest and those discounts shown in
• Reversionary or remainder interests; the example are for demonstration purposes only.
• Shares in trust funds (attach a copy of the trust If you answered “Yes” to Part 4—General Information,
instrument); line 11b, for any transfer(s) described in (1) through (5) in the
• Household goods and personal effects, including Schedule G instructions (and made by the decedent), attach
wearing apparel; a statement to Schedule G which lists the item number
• Farm products and growing crops; from that schedule and identifies the total effective discount
• Livestock; taken (that is, XX.XX%) on such transfer(s).
• Farm machinery; and
• Automobiles. Line 1. If the decedent owned at the date of death works of
art or items with collectible value (for example, jewelry, furs,
Note (for single premium or paid-up policies). In certain silverware, books, statuary, vases, oriental rugs, coin or
situations (for example, where the surrender value of the stamp collections), check the “Yes” box on line 1 and provide
policy exceeds its replacement cost), the true economic full details. If any item or collection of similar items is valued
value of the policy will be greater than the amount shown on at more than $3,000, attach an appraisal by an expert under
Form 712, line 59. In these situations, report the full oath and the required statement regarding the appraiser's
economic value of the policy on Schedule F. See Rev. Rul. qualifications (see Regulations section 20.2031-6(b)).
78-137, 1978-1 C.B. 280, for details.
Decedent Who Was a Surviving Spouse
Interests. If the decedent owned any interest in a
If the decedent was a surviving spouse, the decedent may
partnership or unincorporated business, attach a statement
have received qualified terminable interest property (QTIP)
of assets and liabilities for the valuation date and for the 5
from the predeceased spouse for which the marital deduction
years before the valuation date. Also, attach statements of
was elected either on the predeceased spouse's estate tax
the net earnings for the same 5 years. Be sure to include the
return or on a gift tax return, Form 709. The election is
EIN of the entity. You must account for goodwill in the
available for transfers made and decedents dying after
valuation. In general, furnish the same information and follow
December 31, 1981. List such property on Schedule F.
the methods used to value close corporations. See the
instructions for Schedule B. If this election was made and the surviving spouse
All partnership interests should be reported on Schedule F retained interest in the QTIP property at death, the full value
unless the partnership interest is jointly owned. Jointly owned of the QTIP property is includible in the estate, even though
partnership interests should be reported on Schedule E. the qualifying income interest terminated at death. It is valued
as of the date of the surviving spouse's death, or alternate
If real estate is owned by a sole proprietorship, it should be
valuation date, if applicable. Do not reduce the value by any
reported on Schedule F and not on Schedule A. Describe the
annual exclusion that may have applied to the transfer
real estate with the same detail required for Schedule A.
creating the interest.
Valuation discounts. If you answered “Yes” to Part
4—General Information, line 11b, for any interest in a The value of such property included in the surviving
partnership, an unincorporated business, an LLC, or stock in spouse's gross estate is treated as passing from the
a closely held corporation, attach a statement that lists the surviving spouse. It therefore qualifies for the charitable and
item number from Schedule F and identifies the total effective marital deductions on the surviving spouse's estate tax return
discount taken (that is, XX.XX%) on such interest. if it meets the other requirements for those deductions.
For additional details, see Regulations section 20.2044-1.

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These transfers are reported on Schedule G,
Schedule G—Transfers During regardless of whether a gift tax return was required to be
filed for them when they were made. However, the
Decedent's Life amount includible and the information required to be
If any assets to which the special rule of Regulations shown for the transfers are determined:
• For insurance on the life of the decedent using the
! section 20.2010-2(a)(7)(ii) applies are reported on instructions for Schedule D (attach Form 712);
CAUTION this schedule, do not enter any value in the last three
columns. See the instructions for Part 5—Recapitulation, item • For insurance on the life of another using the
10, for information on how to estimate and report the value of instructions for Schedule F (attach Form 712); and
these assets. • For sections 2036, 2037, and 2038 transfers, using
paragraphs (3), (4), and (5) of these instructions.
Complete Schedule G and file it with the return if the
decedent made any of the transfers described in (1) through 3. Transfers with retained life estate (section 2036).
(5) later, or if you answered “Yes” to question 12 or 13a of These are transfers by the decedent in which the
Part 4—General Information. decedent retained an interest in the transferred property.
The transfer can be in trust or otherwise, but excludes
Report the following types of transfers on this schedule. bona fide sales for adequate and full consideration.
Interests or rights. Section 2036 applies to the
IF. . . AND . . . THEN . . . following retained interests or rights.
the decedent made a at the time of the for purposes of • The right to income from the transferred property.
transfer from a trust transfer, the transfer sections 2035 and • The right to the possession or enjoyment of the
was from a portion of 2038, treat the transfer property.
the trust that was as made directly by the • The right, either alone or with any person, to
owned by the grantor decedent. Any such designate the persons who shall receive the income
under section 676 transfer within the from, possess, or enjoy, the property.
(other than by reason annual gift tax
of section 672(e)) by exclusion is not Retained annuity, unitrust, and other income
reason of a power in includible in the gross interests in trusts. If a decedent transferred property
the grantor estate. into a trust and retained or reserved the right to use the
property, or the right to an annuity, unitrust, or other
interest in such trust for the property for the decedent's
1. Certain gift taxes (section 2035(b)). Enter on item A life, any period not ascertainable without reference to the
of Schedule G the total value of the gift taxes that were decedent's death, or for a period that does not, in fact,
paid by the decedent or the estate on gifts made by the end before the decedent's death, then the decedent's
decedent or the decedent's spouse within 3 years of right to use the property or the retained annuity, unitrust,
death. or other interest (whether payable from income and/or
principal) is the retention of the possession or enjoyment
The date of the gift, not the date of payment of the gift of, or the right to the income from, the property for
tax, determines whether a gift tax paid is included in the purposes of section 2036. See Regulations section
gross estate under this rule. Therefore, you should 20.2036-1(c)(2).
carefully examine the Forms 709 filed by the decedent
and the decedent's spouse to determine what part of the Retained voting rights. Transfers with a retained life
total gift taxes reported on them was attributable to gifts estate also include transfers of stock in a controlled
made within 3 years of death. corporation made after June 22, 1976, if the decedent
retained or acquired voting rights in the stock. If the
For example, if the decedent died on July 10, 2024, decedent retained direct or indirect voting rights in a
you should examine gift tax returns for 2024, 2023, 2022, controlled corporation, the decedent is considered to
and 2021. However, the gift taxes on the 2021 return that have retained enjoyment of the transferred property. A
are attributable to gifts made on or before July 10, 2021, corporation is a controlled corporation if the decedent
are not included in the gross estate. owned (actually or constructively) or had the right (either
Explain how you figured the includible gift taxes if the alone or with any other person) to vote at least 20% of
entire gift taxes shown on any Form 709 filed for gifts the total combined voting power of all classes of stock.
made within 3 years of death are not included in the See section 2036(b)(2). If these voting rights ceased or
gross estate. Also attach copies of any relevant gift tax were relinquished within 3 years of the decedent's death,
returns filed by the decedent's spouse, with "Exhibit to the corporate interests are included in the gross estate
Estate Tax Return" entered across the top of the first as if the decedent had actually retained the voting rights
page of each, for gifts made within 3 years of death. until death.
2. Other transfers within 3 years of death (section The amount includible in the gross estate is the value
2035(a)). These transfers include only the following. of the transferred property at the time of the decedent's
• Any transfer by the decedent with respect to a life death. If the decedent kept or reserved an interest or
insurance policy within 3 years of death. right to only a part of the transferred property, the amount
• Any transfer within 3 years of death of a retained includible in the gross estate is a corresponding part of
section 2036 life estate, section 2037 reversionary the entire value of the property.
interest, or section 2038 power to revoke, etc., if the A retained life estate does not have to be legally
property subject to the life estate, interest, or power enforceable. What matters is that a substantial economic
would have been included in the gross estate had benefit was retained. For example, if a parent transferred
the decedent continued to possess the life estate, the home title to one’s child, but with the informal
interest, or power until death.

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understanding that the parent was to continue living Special Valuation Rules for Certain Lifetime
there until the parent’s death, the value of the home Transfers
would be includible in the parent’s estate even if the
agreement would not have been legally enforceable. Sections 2701 through 2704 provide rules for valuing certain
transfers to family members.
4. Transfers taking effect at death (section 2037). A
transfer that takes effect at the decedent's death is one Section 2701 deals with the transfer of an interest in a
under which possession or enjoyment can be obtained corporation or partnership while retaining certain distribution
only by surviving the decedent. A transfer is not treated rights, or a liquidation, put, call, or conversion right.
as one that takes effect at the decedent's death unless Section 2702 deals with the transfer of an interest in a trust
the decedent retained a reversionary interest (defined while retaining any interest other than a qualified interest. In
later) in the property that immediately before the general, a qualified interest is a right to receive certain
decedent's death had a value of more than 5% of the distributions from the trust at least annually, or a
value of the transferred property. If the transfer was made noncontingent remainder interest if all of the other interests in
before October 8, 1949, the reversionary interest must the trust are distribution rights specified in section 2702.
have arisen by the express terms of the instrument of
transfer. Section 2703 provides rules for the valuation of property
transferred to a family member but subject to an option,
A reversionary interest is, generally, any right under
agreement, or other right to acquire or use the property at
which the transferred property will or may be returned to
less than FMV. It also applies to transfers subject to
the decedent or the decedent's estate. It also includes
restrictions on the right to sell or use the property.
the possibility that the transferred property may become
subject to a power of disposition by the decedent. It does Finally, section 2704 provides that in certain cases, the
not matter if the right arises by the express terms of the lapse of a voting or liquidation right in a family-owned
instrument of transfer or by operation of law. For this corporation or partnership will result in a deemed transfer.
purpose, reversionary interest does not include the
possibility that the income alone from the property may These rules have potential consequences for the valuation
return to the decedent or become subject to the of property in an estate. If the decedent (or any member of
decedent's power of disposition. the decedent’s family) was involved in any such transactions,
see sections 2701 through 2704 and the related regulations
5. Revocable transfers (section 2038). The gross estate for additional details.
includes the value of any transferred property which was
subject to the decedent's power to alter, amend, revoke, How To Complete Schedule G
or terminate the transfer at the time of the decedent's All transfers (other than outright transfers not in trust and
death. A decedent's power to change beneficiaries and bona fide sales) made by the decedent at any time during life
to increase any beneficiary's enjoyment of the property must be reported on Schedule G, regardless of whether you
are examples of this. believe the transfers are subject to tax. If the decedent made
It does not matter whether the power was reserved at any transfers not described in these instructions, the
the time of the transfer, whether it arose by operation of transfers should not be shown on Schedule G. Instead,
law, or whether it was later created or conferred. The rule attach a statement describing these transfers by listing:
applies regardless of the source from which the power • The date of the transfer,
was acquired, and regardless of whether the power was • The amount or value of the transferred property, and
exercisable by the decedent alone or with any person • The type of transfer.
(and regardless of whether that person had a substantial
adverse interest in the transferred property). Complete the schedule for each transfer that is included in
the gross estate under sections 2035(a), 2036, 2037, and
The capacity in which the decedent could use a 2038, as described in the instructions for Schedule G.
power has no bearing. If the decedent gave property in
trust and was the trustee with the power to revoke the In the “Item number” column, number each transfer
trust, the property would be included in the decedent’s consecutively beginning with “1.” In the “Description” column,
gross estate. For transfers or additions to an irrevocable list the name of the transferee and the date of the transfer,
trust after October 28, 1979, the transferred property is and give a complete description of the property. Transfers
includible if the decedent reserved the power to remove included in the gross estate should be valued on the date of
the trustee at will and appoint another trustee. the decedent's death or, if alternate valuation is elected,
If the decedent relinquished within 3 years of death according to section 2032.
any of the includible powers described above, figure the If only part of the property transferred meets the terms of
gross estate as if the decedent had actually retained the section 2035(a), 2036, 2037, or 2038, then only a
powers until death. corresponding part of the value of the property should be
Only the part of the transferred property that is subject included in the value of the gross estate. If the transferee
to the decedent's power is included in the gross estate. makes additions or improvements to the property, the
For more detailed information on which transfers are increased value of the property at the valuation date should
includible in the gross estate, see Regulations section not be included on Schedule G. However, if only a part of the
20.2038-1. value of the property is included, enter the value of the whole
under the column headed “Description” and explain what part
was included.
Attachments. If a transfer, by trust or otherwise, was made
by a written instrument, attach a copy of the instrument to
Schedule G. If the copy of the instrument is of public record, it

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should be certified; if not of public record, the copy should be decedent, the decedent's estate, the decedent's creditors, or
verified. the creditors of the decedent's estate, except the following.
1. A power to consume, invade, or appropriate property for
Schedule H—Powers of Appointment the benefit of the decedent that is limited by an
ascertainable standard relating to health, education,
If any assets to which the special rule of Regulations support, or maintenance of the decedent.
! section 20.2010-2(a)(7)(ii) applies are reported on
CAUTION this schedule, do not enter any value in the last three 2. A power exercisable by the decedent only in conjunction
columns. See the instructions for Part 5—Recapitulation, item with:
10, for information on how to estimate and report the value of
a. The creator of the power; or
these assets.
b. A person who has a substantial interest in the
Complete Schedule H and file it with the return if you
property subject to the power, which is adverse to the
answered “Yes” to question 14 of Part 4—General
exercise of the power in favor of the decedent.
Information.
A part of a power is considered a general power of
On Schedule H, include the following in the gross estate. appointment if the power:
• The value of property for which the decedent possessed
a general power of appointment (defined later) on the 1. May only be exercised by the decedent in conjunction
date of the decedent’s death. with another person, and
• The value of property for which the decedent possessed 2. Is also exercisable in favor of the other person (in
a general power of appointment that the decedent addition to being exercisable in favor of the decedent,
exercised or released before death by disposing of it in the decedent's creditors, the decedent's estate, or the
such a way that if it were a transfer of property owned by creditors of the decedent's estate).
the decedent, the property would be includible in the
decedent's gross estate as a transfer with a retained life When there is a partial power, figure the amount included
estate, a transfer taking effect at death, or a revocable in the gross estate by dividing the value of the property by the
transfer. number of persons (including the decedent) in favor of whom
the power is exercisable.
With the above exceptions, property subject to a power of
appointment is not includible in the gross estate if the Date power was created. Generally, a power of
decedent released the power completely and the decedent appointment created by will is considered created on the
held no interest in or control over the property. date of the testator's death.
A power of appointment created by an inter vivos
If the failure to exercise a general power of appointment instrument is considered created on the date the instrument
results in a lapse of the power, the lapse is treated as a takes effect. If the holder of a power exercises it by creating a
release only to the extent that the value of the property that second power, the second power is considered as created at
could have been appointed by the exercise of the lapsed the time of the exercise of the first.
power is more than the greater of $5,000 or 5% of the total
value, at the time of the lapse, of the assets out of which, or Attachments
the proceeds of which, the exercise of the lapsed power If the decedent ever possessed a power of appointment,
could have been satisfied. attach a certified or verified copy of the instrument granting
the power and a certified or verified copy of any instrument by
Powers of Appointment
which the power was exercised or released. You must file
A power of appointment determines who will own or enjoy the these copies even if you contend that the power was not a
property subject to the power and when they will own or enjoy general power of appointment, and that the property is not
it. The power must be created by someone other than the otherwise includible in the gross estate.
decedent. It does not include a power created or held on
property transferred by the decedent.
Schedule I—Annuities
A power of appointment includes all powers which are, in
substance and effect, powers of appointment regardless of If any assets to which the special rule of Regulations
how they are identified and regardless of local property laws. ! section 20.2010-2(a)(7)(ii) applies are reported on
For example, if a settlor transfers property in trust for the life CAUTION this schedule, do not enter any value in the last three
of the settlor’s spouse, with a power in the spouse to columns. See the instructions for Part 5—Recapitulation, item
appropriate or consume the principal of the trust, the spouse 10, for information on how to estimate and report the value of
has a power of appointment. these assets.
Complete Schedule l and file it with the return if you
Some powers do not in themselves constitute a power of
answered “Yes” to question 16 of Part 4—General
appointment. For example, a power to amend only
Information.
administrative provisions of a trust that cannot substantially
affect the beneficial enjoyment of the trust property or income Enter on Schedule I every annuity that meets all of the
is not a power of appointment. A power to manage, invest, or conditions under General, later, and every annuity described
control assets, or to allocate receipts and disbursements, in paragraphs (a) through (h) of Annuities Under Approved
when exercised only in a fiduciary capacity, is not a power of Plans, later, even if the annuities are wholly or partially
appointment. excluded from the gross estate.
General power of appointment. A general power of
appointment is a power that is exercisable in favor of the

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For a discussion regarding the QTIP treatment of certain Definitions
joint and survivor annuities, see the Schedule M, line 3,
instructions. Annuity. An annuity consists of one or more payments
extending over any period of time. The payments may be
General equal or unequal, conditional or unconditional, periodic or
These rules apply to all types of annuities, including pension sporadic.
plans, individual retirement arrangements (IRAs), purchased Examples. The following are examples of contracts (but
commercial annuities, and private annuities. not necessarily the only forms of contracts) for annuities that
must be included in the gross estate.
In general, you must include in the gross estate all or part 1. A contract under which the decedent immediately before
of the value of any annuity that meets the following death was receiving or was entitled to receive, for the
requirements. duration of life, an annuity with payments to continue
• It is receivable by a beneficiary following the death of the after death to a designated beneficiary, if surviving the
decedent and by reason of surviving the decedent. decedent.
• The annuity is under a contract or agreement entered
into after March 3, 1931. 2. A contract under which the decedent immediately before
• The annuity was payable to the decedent (or the death was receiving or was entitled to receive, together
decedent possessed the right to receive the annuity) with another person, an annuity payable to the decedent
either alone or in conjunction with another, for the and the other person for their joint lives, with payments to
decedent's life or for any period not ascertainable without continue to the survivor following the death of either.
reference to the decedent's death or for any period that
3. A contract or agreement entered into by the decedent
did not in fact end before the decedent's death.
and employer under which the decedent immediately
• The contract or agreement is not a policy of insurance on
before death and following retirement was receiving, or
the life of the decedent.
was entitled to receive, an annuity payable to the
Note. A private annuity is an annuity issued by a party not decedent for life. After the decedent's death, if survived
engaged in the business of writing annuity contracts, typically by a designated beneficiary, the annuity was payable to
a junior generation family member or a family trust. the beneficiary with payments either fixed by contract or
subject to an option or election exercised or exercisable
An annuity contract that provides periodic payments to a by the decedent. However, see Annuities Under
person for life and ceases at the person's death is not Approved Plans, later.
includible in the gross estate. Social security benefits are not 4. A contract or agreement entered into by the decedent
includible in the gross estate even if the surviving spouse and the decedent's employer under which at the
receives benefits. decedent's death, before retirement, or before the
expiration of a stated period of time, an annuity was
An annuity or other payment that is not includible in the
payable to a designated beneficiary, if surviving the
decedent's or the survivor's gross estate as an annuity may
decedent. However, see Annuities Under Approved
still be includible under some other applicable provision of
Plans, later.
the law. For example, see Powers of Appointment and the
instructions for Schedule G—Transfers During Decedent's 5. A contract or agreement under which the decedent
Life, earlier. See also Regulations section 20.2039-1(e). immediately before death was receiving, or was entitled
to receive, an annuity for a stated period of time, with the
If the decedent retired before January 1, 1985, see annuity to continue to a designated beneficiary, surviving
Annuities Under Approved Plans, later, for rules that allow the the decedent, upon the decedent's death and before the
exclusion of part or all of certain annuities. expiration of that period of time.
6. An annuity contract or other arrangement providing for a
Part Includible series of substantially equal periodic payments to be
made to a beneficiary for life or over a period of at least
If the decedent contributed only part of the purchase price of 36 months after the date of the decedent's death under
the contract or agreement, include in the gross estate only an individual retirement account, annuity, or bond as
that part of the value of the annuity receivable by the described in section 2039(e) (before its repeal by P.L.
surviving beneficiary that the decedent's contribution to the 98-369).
purchase price of the annuity or agreement bears to the total
purchase price. Payable to the decedent. An annuity or other payment was
payable to the decedent if, at the time of death, the decedent
For example, if the value of the survivor's annuity was was in fact receiving an annuity or other payment, with or
$20,000 and the decedent had contributed 75% of the without an enforceable right to have the payments continued.
purchase price of the contract, the amount includible is Right to receive an annuity. The decedent had the right to
$15,000 (75% (0.75) × $20,000). receive an annuity or other payment if, immediately before
death, the decedent had an enforceable right to receive
Except as provided under Annuities Under Approved payments at some time in the future, whether or not at the
Plans, later, contributions made by the decedent's employer time of death the decedent had a present right to receive
to the purchase price of the contract or agreement are payments.
considered made by the decedent if they were made by the
employer because of the decedent's employment. For more
information, see section 2039(b).

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Annuities Under Approved Plans of the annuity which the amount of the decedent's
The following rules relate to whether part or all of an contribution under the plan bears to the total amount of all
otherwise includible annuity may be excluded. These rules contributions under the plan. The remaining value of the
have been repealed and apply only if the decedent either: annuity is excludable from the gross estate subject to the
• On December 31, 1984, was both a participant in the $100,000 limitation (if applicable). For the rules to determine
plan and in pay status (for example, had received at least whether the decedent made contributions to the plan, see
one benefit payment on or before December 31, 1984) Regulations section 20.2039-1(c).
and had irrevocably elected the form of the benefit before IRAs and retirement bonds. The following plans are
July 18, 1984; or approved plans for the exclusion rules.
• Had separated from service before January 1, 1985, and f. An individual retirement account described in section
did not change the form of benefit before death. 408(a).
The amount excluded cannot exceed $100,000 unless g. An individual retirement annuity described in section
either of the following conditions is met. 408(b).
• On December 31, 1982, the decedent was both a h. A retirement bond described in section 409(a) (before
participant in the plan and in pay status (for example, had its repeal by P.L. 98-369).
received at least one benefit payment on or before Exclusion rules for IRAs and retirement bonds. These
December 31, 1982) and the decedent irrevocably plans are approved plans only if they provide for a series of
elected the form of the benefit before January 1, 1983. substantially equal periodic payments made to a beneficiary
• The decedent separated from service before January 1, for life, or over a period of at least 36 months after the date of
1983, and did not change the form of benefit before the decedent's death.
death.
Subject to the $100,000 limitation (if applicable), if an
annuity under a “plan” described in (f) through (h) above is
Approved Plans receivable by a beneficiary other than the executor, the entire
value of the annuity is excludable from the gross estate even
Approved plans may be separated into two categories. if the decedent made a contribution under the plan.
• Pension, profit-sharing, stock bonus, and other similar However, if any payment to or for an account or annuity
plans. described in paragraph (f), (g), or (h) earlier was not
• IRAs and retirement bonds. allowable as an income tax deduction under section 219 (and
was not a rollover contribution, as described in section
Different exclusion rules apply to the two categories of 2039(e) before its repeal by P.L. 98-369), include in the gross
plans. estate on this schedule that proportion of the value of the
Pension, etc., plans. The following plans are approved annuity which the amount not allowable as a deduction under
plans for the exclusion rules. section 219 and not a rollover contribution bears to the total
a. An employees' trust (or a contract purchased by an amount paid to or for such account or annuity. For more
employees' trust) forming part of a pension, stock bonus, or information, see Regulations section 20.2039-5.
profit-sharing plan that met all the requirements of section Rules applicable to all approved plans. The following
401(a), either at the time of the decedent's separation from rules apply to all approved plans described in paragraphs (a)
employment (whether by death or otherwise) or at the time of through (h), earlier.
the termination of the plan (if earlier). If any part of an annuity under a “plan” described in (a)
b. A retirement annuity contract purchased by the through (h), earlier, is receivable by the executor, it is
employer (but not by an employees' trust) under a plan that, generally includible in the gross estate to the extent that it is
at the time of the decedent's separation from employment (by receivable by the executor in that capacity. In general, the
death or otherwise), or at the time of the termination of the annuity is receivable by the executor if it is to be paid to the
plan (if earlier), was a plan described in section 403(a). executor or if there is an agreement (expressed or implied)
c. A retirement annuity contract purchased for an that it will be applied by the beneficiary for the benefit of the
employee by an employer that is an organization referred to estate (such as in discharge of the estate's liability for death
in section 170(b)(1)(A)(ii) or (vi), or that is a religious taxes or debts of the decedent, etc.) or that its distribution will
organization (other than a trust), and that is exempt from tax be governed to any extent by the terms of the decedent's will
under section 501(a). or the laws of descent and distribution.
d. Chapter 73 of title 10 of the United States Code. If data available to you does not indicate whether the plan
e. A bond purchase plan described in section 405 (before satisfies the requirements of section 401(a), 403(a), 408(a),
its repeal by P.L. 98-369, effective for obligations issued after 408(b), or 409(a), you may obtain that information from the
December 31, 1983). IRS office where the employer's principal place of business is
located.
Exclusion rules for pension, etc., plans. If an annuity
under an approved plan described in (a) through (e) above is Line A. Lump-Sum Distribution Election
receivable by a beneficiary other than the executor and the
decedent made no contributions under the plan toward the Note. The following rules have been repealed and apply only
cost, no part of the value of the annuity, subject to the if the decedent:
$100,000 limitation (if applicable), is includible in the gross • On December 31, 1984, was both a participant in the
estate. plan and in pay status (for example, had received at least
If the decedent made a contribution under a plan one benefit payment on or before December 31, 1984)
described in (a) through (e) above toward the cost, include in and had irrevocably elected the form of the benefit before
the gross estate on this schedule that proportion of the value July 18, 1984; or

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• Had separated from service before January 1, 1985, and IF . . . THEN . . .
did not change the form of benefit before death.
Generally, the entire amount of any lump-sum distribution the annuity is wholly or partially enter the amount excluded under
is included in the decedent's gross estate. However, under excluded from the gross estate “Description” and explain how you
figured the exclusion.
this special rule, all or part of a lump-sum distribution from a
qualified (approved) plan will be excluded if the lump-sum
distribution is included in the recipient's income for income
tax purposes.
If the decedent was born before 1936, the recipient may Schedule J—Funeral Expenses and
be eligible to elect special “10-year averaging” rules (under Expenses Incurred in Administering
repealed section 402(e)) and capital gain treatment (under
repealed section 402(a)(2)) in figuring the income tax on the Property Subject to Claims
distribution. For more information, see Pub. 575, Pension and Use Schedule PC to make a protective claim for
Annuity Income. If this option is available, the estate tax ! refund for expenses which are not currently
exclusion cannot be claimed unless the recipient elects to CAUTION deductible under section 2053. For such a claim,
forego the “10-year averaging” and capital gain treatment in report the expense on Schedule J but without a value in the
figuring the income tax on the distribution. The recipient last column.
elects to forego this treatment by treating the distribution as
taxable on the recipient’s income tax return, as described in General. Complete and file Schedule J if you claim a
Regulations section 20.2039-4(d). The election is deduction on item 14 of Part 5—Recapitulation.
irrevocable.
On Schedule J, itemize funeral expenses and expenses
The amount excluded from the gross estate is the portion incurred in administering property subject to claims. List the
attributable to the employer contributions. The portion, if any, names and addresses of persons to whom the expenses are
attributable to the employee-decedent's contributions is payable and describe the nature of the expense. Do not list
always includible. Also, you may not figure the gross estate in expenses incurred in administering property not
accordance with this election unless you check “Yes” on line subject to claims on this schedule. List them on
A and attach the names, addresses, and identifying numbers Schedule L instead.
of the recipients of the lump-sum distributions. See
The deduction is limited to the amount paid for these
Regulations section 20.2039-4(d)(2).
expenses that is allowable under local law but may not
How To Complete Schedule I exceed:
In describing an annuity, give the name and address of the 1. The value of property subject to claims included in the
grantor of the annuity. Specify if the annuity is under an gross estate, plus
approved plan. 2. The amount paid out of property included in the gross
IF . . . THEN . . . estate but not subject to claims. This amount must
the annuity is under an approved state the ratio of the decedent's actually be paid by the due date of the estate tax return.
plan contribution to the total purchase The applicable local law under which the estate is being
price of the annuity. administered determines which property is and is not subject
to claims. If under local law a particular property interest
the decedent was employed at the state the ratio of the decedent's included in the gross estate would bear the burden for the
time of death and an annuity as contribution to the total purchase payment of the expenses, then the property is considered
described earlier in Definitions, price of the annuity. property subject to claims.
Annuity, Example 4 became
payable to any beneficiary because Unlike certain claims against the estate for debts of the
the beneficiary survived the decedent (see the instructions for Schedule K), you cannot
decedent deduct expenses incurred in administering property subject
to claims on both the estate tax return and the estate's
an annuity under an individual state the ratio of the amount paid income tax return. If you choose to deduct them on the estate
retirement account or annuity for the individual retirement tax return, you cannot deduct them on a Form 1041, U.S.
became payable to any beneficiary account or annuity that was not Income Tax Return for Estates and Trusts, filed for the estate.
because that beneficiary survived allowable as an income tax Funeral expenses are only deductible on the estate tax
the decedent and is payable to the deduction under section 219 (other return.
beneficiary for life or for at least 36 than a rollover contribution) to the
months following the decedent's total amount paid for the account or Funeral expenses. Itemize funeral expenses on line A.
death annuity. Deduct from the expenses any amounts that were
reimbursed, such as death benefits payable by the SSA or
the annuity is payable out of a trust the description should be the Veterans Administration.
or other fund sufficiently complete to fully identify Executors' commissions. When you file the return, you
it.
may deduct commissions that have actually been paid to you
or that you expect will be paid. Do not deduct commissions if
the annuity is payable for a term of include the duration of the term and none will be collected. If the amount of the commissions has
years the date on which it began. not been fixed by decree of the proper court, the deduction
the annuity is payable for the life of include the date of birth of that
a person other than the decedent person.

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will be allowed on the final examination of the return, appraiser's and accountant's fees, certain court costs, and
provided that: costs of storing or maintaining assets of the estate.
• The Chief, Estate and Gift/Excise Tax Examination, is The expenses of selling assets are deductible only if the
reasonably satisfied that the commissions claimed will be sale is necessary to pay the decedent's debts, the expenses
paid; of administration, or taxes, or to preserve the estate or carry
• The amount entered as a deduction is within the amount out distribution.
allowable by the laws of the jurisdiction where the estate
is being administered; and
• It is in accordance with the usually accepted practice in Schedule K—Debts of the Decedent,
that jurisdiction for estates of similar size and character. and Mortgages and Liens
If you have not been paid the commissions claimed at the
time of the final examination of the return, you must support Use Schedule PC to make a protective claim for
the amount you deducted with an affidavit or statement ! refund for expenses which are not currently
signed under the penalties of perjury that the amount has CAUTION deductible under section 2053. For such a claim,
been agreed upon and will be paid. report the expense on Schedule K but without a value in the
last column.
You may not deduct a bequest or devise made to you
instead of commissions. If, however, the decedent fixed by You must complete and attach Schedule K if you claimed
will the compensation payable to you for services to be deductions on either item 15 or item 16 of Part
rendered in the administration of the estate, you may deduct 5—Recapitulation.
this amount to the extent it is not more than the Income vs. estate tax deduction. Taxes, interest, and
compensation allowable by the local law or practice. business expenses accrued at the date of the decedent's
Do not deduct on this schedule amounts paid as trustees' death are deductible both on Schedule K and as deductions
commissions whether received by you acting in the capacity in respect of the decedent on the income tax return of the
of a trustee or by a separate trustee. If such amounts were estate.
paid in administering property not subject to claims, deduct If you choose to deduct medical expenses of the decedent
them on Schedule L. only on the estate tax return, they are fully deductible as
claims against the estate. If, however, they are claimed on the
Note. Executors' commissions are taxable income to the decedent's final income tax return under section 213(c), they
executors. Therefore, be sure to include them as income on may also not be claimed on the estate tax return. In this case,
your individual income tax return. you may also not deduct on the estate tax return any
Attorney fees. Enter the amount of attorney fees that have amounts that were not deductible on the income tax return
actually been paid or that you reasonably expect to be paid. because of the percentage limitations.
If, on the final examination of the return, the fees claimed
have not been awarded by the proper court and paid, the Debts of the Decedent
deduction will be allowed, provided the Chief, Estate and Gift/ List under Debts of the Decedent only valid debts the
Excise Tax Examination, is reasonably satisfied that the decedent owed at the time of death. List any indebtedness
amount claimed will be paid and that it does not exceed a secured by a mortgage or other lien on property of the gross
reasonable payment for the services performed, taking into estate under Mortgages and Liens. If the amount of the debt
account the size and character of the estate and the local law is disputed or the subject of litigation, deduct only the amount
and practice. If the fees claimed have not been paid at the the estate concedes to be a valid claim.
time of final examination of the return, the amount deducted
must be supported by an affidavit, or statement signed under Generally, if the claim against the estate is based on a
penalties of perjury, by the executor or the attorney stating promise or agreement, the deduction is limited to the extent
that the amount has been agreed upon and will be paid. that the liability was contracted bona fide and for an adequate
and full consideration in money or money's worth. However,
Do not deduct attorney fees incidental to litigation incurred any enforceable claim based on a promise or agreement of
by the beneficiaries. These expenses are charged against the decedent to make a contribution or gift (such as a pledge
the beneficiaries personally and are not administration or a subscription) to or for the use of a charitable, public,
expenses authorized by the Code. religious, etc., organization is deductible to the extent that the
Interest expense. Interest expenses incurred after the deduction would be allowed as a bequest under the statute
decedent's death are generally allowed as a deduction if they that applies.
are reasonable, necessary to the administration of the estate,
Certain claims of a former spouse against the estate
and allowable under local law.
based on the relinquishment of marital rights are deductible
Interest incurred as the result of a federal estate tax on Schedule K. For these claims to be deductible, all of the
deficiency is a deductible administrative expense. Penalties following conditions must be met.
on estate tax deficiencies are not deductible even if they are • The decedent and the decedent's spouse must have
allowable under local law. entered into a written agreement relative to their marital
and property rights.
Note. If you elect to pay the tax in installments under section The decedent and the spouse must have been divorced
•
6166, you may not deduct the interest payable on the before the decedent's death and the divorce must have
installments. occurred within the 3-year period beginning on the date 1
Miscellaneous expenses. Miscellaneous administration year before the agreement was entered into. It is not
expenses necessarily incurred in preserving and distributing required that the agreement be approved by the divorce
the estate are deductible. These expenses include decree.

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• The property or interest transferred under the agreement other agreement by which the debt was established. Also
must be transferred to the decedent's spouse in include the face amount, the unpaid balance, the rate of
settlement of the spouse's marital rights. interest, and the date to which the interest was paid before
You may not deduct a claim made against the estate by a the decedent's death.
remainderman relating to section 2044 property. Section
2044 property is described in the instructions for Part Schedule L—Net Losses During
4—General Information, line 7.
Administration and Expenses
Include in this schedule notes unsecured by mortgage or
other lien and give full details, including: Incurred in Administering Property
• Name of payee, Not Subject to Claims
• Face and unpaid balance,
• Date and term of note, Use Schedule PC to make a protective claim for
• Interest rate, and ! refund for expenses which are not currently
• Date to which interest was paid before death. CAUTION deductible under section 2053. For such a claim,
Include the exact nature of the claim as well as the name report the expense on Schedule L but without a value in the
of the creditor. If the claim is for services performed over a last column.
period of time, state the period covered by the claim. Complete Schedule L and file it with the return if you claim
Example. Electric Illuminating Co., for electric service deductions on either item 19 or item 20 of Part
during December 2023, $150. 5—Recapitulation.

If the amount of the claim is the unpaid balance due on a Net Losses During Administration
contract for the purchase of any property included in the
You may deduct only those losses from thefts, fires, storms,
gross estate, indicate the schedule and item number where
shipwrecks, or other casualties that occurred during the
you reported the property. If the claim represents a joint and
settlement of the estate. Deduct only the amount not
separate liability, give full facts and explain the financial
reimbursed by insurance or otherwise.
responsibility of the co-obligor.
Describe in detail the loss sustained and the cause. If you
Property and income taxes. The deduction for property
received insurance or other compensation for the loss, state
taxes is limited to the taxes accrued before the date of the
the amount collected. Identify the property for which you are
decedent's death. Federal taxes on income received during
claiming the loss by indicating the schedule and item number
the decedent's lifetime are deductible, but taxes on income
where the property is included in the gross estate.
received after death are not deductible.
Keep all vouchers or original records for inspection by the If you elect alternate valuation, do not deduct the amount
IRS. by which you reduced the value of an item to include it in the
gross estate.
Allowable death taxes. If you elect to take a deduction for
foreign death taxes under section 2053(d) rather than a credit Do not deduct losses claimed as a deduction on a federal
under section 2014, the deduction is subject to the limitations income tax return or depreciation in the value of securities or
described in section 2053(d) and its regulations. other property.

Mortgages and Liens Expenses Incurred in Administering Property
Under Mortgages and Liens, list only obligations secured by Not Subject to Claims
mortgages or other liens on property included in the gross You may deduct expenses incurred in administering property
estate at its full value or at a value that was undiminished by that is included in the gross estate but that is not subject to
the amount of the mortgage or lien. If the debt is enforceable claims. Only deduct these expenses if they were paid before
against other property of the estate not subject to the the section 6501 period of limitations for assessment expired.
mortgage or lien, or if the decedent was personally liable for The expenses deductible on this schedule are usually
the debt, include the full value of the property subject to the expenses incurred in the administration of a trust established
mortgage or lien in the gross estate under the appropriate by the decedent before death. They may also be incurred in
schedule and deduct the mortgage or lien on the property on the collection of other assets or the transfer or clearance of
this schedule. title to other property included in the decedent's gross estate
However, if the decedent's estate is not liable, include in for estate tax purposes, but not included in the decedent's
the gross estate only the value of the equity of redemption (or probate estate.
the value of the property less the amount of the debt), and do
The expenses deductible on this schedule are limited to
not deduct any portion of the indebtedness on this schedule.
those that are the result of settling the decedent's interest in
Notes and other obligations secured by the deposit of the property or of vesting good title to the property in the
collateral, such as stocks, bonds, etc., should also be listed beneficiaries. Expenses incurred on behalf of the transferees
under Mortgages and Liens. (except those described earlier) are not deductible.
Examples of deductible and nondeductible expenses are
Description provided in Regulations section 20.2053-8(d).
Include under the “Description” column the particular List the names and addresses of the persons to whom
schedule and item number where the property subject to the each expense was payable and the nature of the expense.
mortgage or lien is reported in the gross estate. Identify the property for which the expense was incurred by
Include the name and address of the mortgagee, payee, indicating the schedule and item number where the property
or obligee, and the date and term of the mortgage, note, or is included in the gross estate. If you do not know the exact

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amount of the expense, you may deduct an estimate, 3. As an appointee under the decedent's exercise of a
provided that the amount may be verified with reasonable power or as a taker in default at the decedent's
certainty and will be paid before the period of limitations for nonexercise of a power;
assessment (referred to earlier) expires. Keep all vouchers
4. As a beneficiary of insurance on the decedent's life;
and receipts for inspection by the IRS.
5. As the surviving spouse taking under dower or curtesy
Schedule M—Bequests, etc., to (or similar statutory interest); and
6. As a transferee of a transfer made by the decedent at
Surviving Spouse (Marital Deduction)
any time.
If any assets to which the special rule of Regulations
! section 20.2010-2(a)(7)(ii) applies are reported on Property Interests That You May Not List on
CAUTION this schedule, do not enter any value in the last three
columns. See the instructions for Part 5—Recapitulation, item Schedule M
23, for information on how to estimate and report the value of Do not list the following on Schedule M.
these assets. 1. The value of any property that does not pass from the
decedent to the surviving spouse.
General
2. Property interests that are not included in the decedent's
You must complete Schedule M and file it with the return if gross estate.
you claim a deduction on item 21 of Part 5—Recapitulation.
3. The full value of a property interest for which a deduction
The marital deduction is authorized by section 2056 for was claimed on Schedules J through L. The value of the
certain property interests that pass from the decedent to the property interest should be reduced by the deductions
surviving spouse. You may claim the deduction only for claimed with respect to it.
property interests that are included in the decedent's gross
estate (Schedules A through I). 4. The full value of a property interest that passes to the
surviving spouse subject to a mortgage or other
Note. The marital deduction is generally not allowed if the encumbrance or an obligation of the surviving spouse.
surviving spouse is not a U.S. citizen. The marital deduction Include on Schedule M only the net value of the interest
is allowed for property passing to such a surviving spouse in after reducing it by the amount of the mortgage or other
a QDOT or if such property is transferred or irrevocably debt.
assigned to such a trust before the estate tax return is filed. 5. Nondeductible terminable interests (described later).
The executor must elect QDOT status on the return. See the
instructions that follow for details on the election. 6. Any property interest disclaimed by the surviving
spouse.
Property Interests That You May List on
Schedule M Terminable Interests
Generally, you may list on Schedule M all property interests Certain interests in property passing from a decedent to a
that pass from the decedent to the surviving spouse and are surviving spouse are referred to as terminable interests.
included in the gross estate. However, do not list any These are interests that will terminate or fail after the passage
nondeductible terminable interests (described later) on of time, or on the occurrence or nonoccurrence of a
Schedule M unless you are making a QTIP election. The designated event. Examples are life estates, annuities,
property for which you make this election must be included estates for terms of years, and patents.
on Schedule M. See Qualified terminable interest property, The ownership of a bond, note, or other contractual
later. obligation, which when discharged would not have the effect
For the rules on common disaster and survival for a limited of an annuity for life or for a term, is not considered a
period, see section 2056(b)(3). terminable interest.
Nondeductible terminable interests. Unless you are
You may list on Schedule M only those interests that the
making a QTIP election, do not enter a terminable interest on
surviving spouse takes:
Schedule M if:
1. As the decedent's legatee, devisee, heir, or donee;
1. Another interest in the same property passed from the
2. As the decedent's surviving tenant by the entirety or joint decedent to some other person for less than adequate
tenant; and full consideration in money or money's worth; and
Example—Listing Property Interests on Schedule M

Item Description of property interests passing to surviving spouse. Amount
number For securities, give CUSIP number. If trust, partnership, or closely held entity, give EIN.
All other property:
B1 One-half the value of a house and lot, 256 South West Street, held by decedent and surviving spouse as joint tenants
with right of survivorship under deed dated July 15, 1975 (Schedule E, Part 1, item 1) . . . . . . . . . . . . . . . . . . $182,500
B2 Proceeds of Metropolitan Life Insurance Company Policy No. 104729, payable in one sum to surviving spouse
(Schedule D, item 3) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 200,000
B3 Cash bequest under Paragraph Six of will . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 100,000

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2. By reason of its passing, the other person or that treated as a nondeductible terminable interest if the following
person's heirs may enjoy part of the property after the five conditions apply.
termination of the surviving spouse's interest.
1. The surviving spouse is entitled for life to all of the
This rule applies even though the interest that passes from income from the entire interest.
the decedent to a person other than the surviving spouse is
2. The income is payable annually or at more frequent
not included in the gross estate, and regardless of when the
intervals.
interest passes. The rule also applies regardless of whether
the surviving spouse's interest and the other person's interest 3. The surviving spouse has the power, exercisable in favor
pass from the decedent at the same time. of the surviving spouse or the estate of the surviving
Property interests that are considered to pass to a person spouse, to appoint the entire interest.
other than the surviving spouse are any property interest that 4. The power is exercisable by the surviving spouse alone
(a) passes under a decedent's will or intestacy; (b) was and (whether exercisable by will or during life) is
transferred by a decedent during life; or (c) is held by or exercisable by the surviving spouse in all events.
passed on to any person as a decedent's joint tenant, as
appointee under a decedent's exercise of a power, as taker in 5. No part of the entire interest is subject to a power in any
default at a decedent's release or nonexercise of a power, or other person to appoint any part to any person other than
as a beneficiary of insurance on the decedent's life. See the surviving spouse (or the surviving spouse's legal
Regulations section 20.2056(c)-3. representative or relative if the surviving spouse is
For example, a spouse was devised real property for life, disabled; see Regulations section 20.2056(b)-5(a) and
from the decedent, with remainder to the children. The life Rev. Rul. 85-35, 1985-1 C.B. 328).
interest that passed to the spouse does not qualify for the If these five conditions are satisfied only for a specific
marital deduction because it will terminate at the spouse’s portion of the entire interest, see Regulations sections
death and the children will thereafter possess or enjoy the 20.2056(b)-5(b) and -5(c) to determine the amount of the
property. marital deduction.
However, if the decedent purchased a joint and survivor Life insurance, endowment, or annuity payments, with
annuity for themselves and the spouse who survived them, power of appointment in surviving spouse. A property
the value of the survivor's annuity, to the extent that it is interest consisting of the entire proceeds under a life
included in the gross estate, qualifies for the marital insurance, endowment, or annuity contract is treated as
deduction because even though the interest will terminate on passing from the decedent to the surviving spouse, and will
the spouse’s death, no one else will possess or enjoy any not be treated as a nondeductible terminable interest if the
part of the property. following five conditions apply.
The marital deduction is not allowed for an interest that the
decedent directed the executor or a trustee to convert, after 1. The surviving spouse is entitled to receive the proceeds
death, into a terminable interest for the surviving spouse. The in installments, or is entitled to interest on them, with all
marital deduction is not allowed for such an interest even if amounts payable during the life of the spouse, payable
there was no interest in the property passing to another only to the surviving spouse.
person and even if the terminable interest would otherwise 2. The installment or interest payments are payable
have been deductible under the exceptions described later annually, or more frequently, beginning not later than 13
for life estates, life insurance, and annuity payments with months after the decedent's death.
powers of appointment. For more information, see
Regulations section 20.2056(b)-1(f); and Regulations section 3. The surviving spouse has the power, exercisable in favor
20.2056(b)-1(g), Example (7). of the surviving spouse or of the estate of the surviving
spouse, to appoint all amounts payable under the
If any property interest passing from the decedent to the contract.
surviving spouse may be paid or otherwise satisfied out of
any of a group of assets, the value of the property interest is, 4. The power of appointment is exercisable by the surviving
for the entry on Schedule M, reduced by the value of any spouse alone and (whether exercisable by will or during
asset or assets that, if passing from the decedent to the life) is exercisable by the surviving spouse in all events.
surviving spouse, would be nondeductible terminable 5. No part of the amount payable under the contract is
interests. Examples of property interests that may be paid or subject to a power in any other person to appoint any
otherwise satisfied out of any of a group of assets are a part to any person other than the surviving spouse.
bequest of the residue of the decedent's estate, or of a share
of the residue, and a cash legacy payable out of the general If these five conditions are satisfied only for a specific
estate. portion of the proceeds, see Regulations section
Example. A decedent bequeathed $100,000 to the 20.2056(b)-6(b) to determine the amount of the marital
surviving spouse. The general estate includes a term for deduction.
years (valued at $10,000 in determining the value of the Charitable remainder trusts. An interest in a charitable
gross estate) in an office building, which interest was retained remainder trust will not be treated as a nondeductible
by the decedent under a deed of the building by gift to the terminable interest if:
decedent’s child. Accordingly, the value of the specific
bequest entered on Schedule M is $90,000. 1. The interest in the trust passes from the decedent to the
surviving spouse, and
Life estate with power of appointment in the surviving
spouse. A property interest, whether or not in trust, will be 2. The surviving spouse is the only beneficiary of the trust
treated as passing to the surviving spouse, and will not be other than charitable organizations described in section
170(c).

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A charitable remainder trust is either a charitable 1. The trust or other property is listed on Schedule M, and
remainder annuity trust or a charitable remainder unitrust.
2. The value of the trust (or other property) is entered in
See section 664 for descriptions of these trusts.
whole or in part as a deduction on Schedule M,
Election To Deduct Qualified Terminable Interest then unless the executor specifically identifies the trust (all or
Property (QTIP) a fractional portion or percentage) or other property to be
You may elect to claim a marital deduction for qualified excluded from the election, the executor shall be deemed to
terminable interest property or property interests. You make have made an election to have such trust (or other property)
the QTIP election simply by listing the qualified terminable treated as qualified terminable interest property under
interest property on Part A of Schedule M and inserting its section 2056(b)(7).
value. You are presumed to have made the QTIP election if If less than the entire value of the trust (or other property)
you list the property and insert its value on Schedule M. If you that the executor has included in the gross estate is entered
make this election, the surviving spouse's gross estate will as a deduction on Schedule M, the executor shall be
include the value of the qualified terminable interest property. considered to have made an election only as to a fraction of
See the instructions for Part 4—General Information, line 7, the trust (or other property). The numerator of this fraction is
for more details. The election is irrevocable. equal to the amount of the trust (or other property) deducted
If you file a Form 706 in which you do not make this on Schedule M. The denominator is equal to the total value of
election, you may not file an amended return to make the the trust (or other property).
election unless you file the amended return on or before the
due date for filing the original Form 706. Qualified Domestic Trust (QDOT) Election
The marital deduction is allowed for transfers to a surviving
The effect of the election is that the property (interest) will
spouse who is not a U.S. citizen only if the property passes to
be treated as passing to the surviving spouse and will not be
the surviving spouse in a QDOT or if such property is
treated as a nondeductible terminable interest. All of the
transferred or irrevocably assigned to a QDOT before the
other marital deduction requirements must still be satisfied
decedent's estate tax return is filed.
before you may make this election. For example, you may not
make this election for property or property interests that are A QDOT is any trust:
not included in the decedent's gross estate.
1. That requires at least one trustee to be either a citizen of
Qualified terminable interest property. Qualified the United States or a domestic corporation,
terminable interest property is property (a) that passes from
the decedent, (b) in which the surviving spouse has a 2. That requires that no distribution of corpus from the trust
qualifying income interest for life, and (c) for which election can be made unless such a trustee has the right to
under section 2056(b)(7) has been made. withhold from the distribution the tax imposed on the
QDOT,
The surviving spouse has a qualifying income interest for
life if the surviving spouse is entitled to all of the income from 3. That meets the requirements of any applicable
the property payable annually or at more frequent intervals, or regulations, and
has a usufruct interest for life in the property, and during the 4. For which the executor has made an election on the
surviving spouse's lifetime no person has a power to appoint estate tax return of the decedent.
any part of the property to any person other than the
surviving spouse. An annuity is treated as an income interest Note. For trusts created by an instrument executed before
regardless of whether the property from which the annuity is November 5, 1990, items 1 and 2 above will be treated as
payable can be separately identified. met if the trust instrument requires that all trustees be
Regulations sections 20.2044-1 and 20.2056(b)-7(d)(3) individuals who are citizens of the United States or domestic
state that an interest in property is eligible for QTIP treatment corporations.
if the income interest is contingent upon the executor's You make the QDOT election simply by listing the qualified
election even if that portion of the property for which no domestic trust or the entire value of the trust property on
election is made will pass to or for the benefit of beneficiaries Schedule M and deducting its value. You are presumed to
other than the surviving spouse. have made the QDOT election if you list the trust or trust
The QTIP election may be made for all or any part of property and insert its value on Schedule M. Once made,
qualified terminable interest property. A partial election must the election is irrevocable.
relate to a fractional or percentile share of the property so If an election is made to deduct qualified domestic trust
that the elective part will reflect its proportionate share of the property under section 2056A(d), provide the following
increase or decline in the whole of the property when information for each qualified domestic trust on an
applying section 2044 or 2519. Thus, if the interest of the attachment to this schedule.
surviving spouse in a trust (or other property in which the
spouse has a qualified life estate) is qualified terminable 1. The name and address of every trustee.
interest property, you may make an election for a part of the 2. A description of each transfer passing from the decedent
trust (or other property) only if the election relates to a that is the source of the property to be placed in trust.
defined fraction or percentage of the entire trust (or other
property). The fraction or percentage may be defined by 3. The EIN for the trust.
means of a formula.
The election must be made for an entire QDOT trust. In
Election to deduct qualified terminable interest proper- listing a trust for which you are making a QDOT election,
ty under section 2056(b)(7). If a trust (or other property) unless you specifically identify the trust as not subject
meets the requirements of qualified terminable interest to the election, the election will be considered made for
property under section 2056(b)(7), and the entire trust.

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The determination of whether a trust qualifies as a QDOT         If Schedule M includes a bequest of the residue or a part 
will be made as of the date the decedent's Form 706 is filed.    of the residue of the decedent's estate, attach a copy of the 
If, however, judicial proceedings are brought before the Form    computation showing how the value of the residue was 
706's due date (including extensions) to have the trust          determined. Include a statement showing the following.
revised to meet the QDOT requirements, then the                  • The value of all property that is included in the 
determination will not be made until the court-ordered             decedent's gross estate (Schedules A through I) but is 
changes to the trust are made.                                     not a part of the decedent's probate estate, such as 
                                                                   lifetime transfers, jointly owned property that passed to 
Election to deduct qualified domestic trust property un-
                                                                   the survivor on the decedent's death, and the insurance 
der section 2056A. If a trust meets the requirement of a 
                                                                   payable to specific beneficiaries.
QDOT under section 2056A(a), the return is filed no later 
than 1 year after the time prescribed by law (including          • The values of all specific and general legacies or 
                                                                   devises, with reference to the applicable clause or 
extensions), and the entire value of the trust or trust property 
                                                                   paragraph of the decedent's will or codicil. (If legacies 
is listed and entered as a deduction on Schedule M, then 
                                                                   are made to each member of a class, for example, 
unless the executor specifically identifies the trust to be 
                                                                   $1,000 to each of the decedent's employees, only the 
excluded from the election, the executor shall be deemed to 
                                                                   number in each class and the total value of property 
have made an election to have the entire trust treated as 
                                                                   received by them need be furnished.)
qualified domestic trust property.
                                                                 • The dates of birth of all persons, the length of whose 
Note. For trusts with assets in excess of $2 million, see          lives may affect the value of the residuary interest 
Regulations section 20.2056A-2(d) for additional                   passing to the surviving spouse.
requirements to ensure collection of the section 2056A estate    • Any other important information such as that relating to 
tax.                                                               any claim to any part of the estate not arising under the 
                                                                   will.
Line 1                                                           Lines 5a, 5b, and 5c. The total of the values listed on 
If property passes to the surviving spouse as the result of a    Schedule M must be reduced by the amount of the federal 
qualified disclaimer, check “Yes” and attach a copy of the       estate tax, the federal GST tax, and the amount of state or 
written disclaimer required by section 2518(b).                  other death and GST taxes paid out of the property interest 
                                                                 involved. If you enter an amount for state or other death or 
Line 3                                                           GST taxes on line 5b or 5c, identify the taxes and attach your 
Section 2056(b)(7)(C)(ii) creates an automatic QTIP election     computation of them.
for certain joint and survivor annuities that are includible in 
                                                                 Attachments. If you list property interests passing by the 
the estate under section 2039. To qualify, only the surviving 
                                                                 decedent's will on Schedule M, attach a certified copy of the 
spouse can have the right to receive payments before the 
                                                                 order admitting the will to probate. If, when you file the return, 
death of the surviving spouse.
                                                                 the court of probate jurisdiction has entered any decree 
The executor can elect out of QTIP treatment, however, by        interpreting the will or any of its provisions affecting any of the 
checking the “Yes” box on line 3. Once made, the election        interests listed on Schedule M, or has entered any order of 
is irrevocable. If there is more than one such joint and         distribution, attach a copy of the decree or order. In addition, 
survivor annuity, you are not required to make the election for  the IRS may request other evidence to support the marital 
all of them.                                                     deduction claimed.

If you make the election out of QTIP treatment by checking 
                                                                 Schedule O—Charitable, Public, and 
“Yes” on line 3, you cannot deduct the amount of the annuity 
on Schedule M. If you do not elect out, you must list the joint  Similar Gifts and Bequests
and survivor annuities on Schedule M.
                                                                         If any assets to which the special rule of Regulations 
Listing Property Interests on Schedule M                         !       section 20.2010-2(a)(7)(ii) applies are reported on 
                                                                 CAUTION this schedule, do not enter any value in the last three 
List each property interest included in the gross estate that 
                                                                 columns. See the instructions for Part 5—Recapitulation, item 
passes from the decedent to the surviving spouse and for 
                                                                 23, for information on how to estimate and report the value of 
which a marital deduction is claimed. This includes otherwise 
                                                                 these assets.
nondeductible terminable interest property for which you are 
making a QTIP election. Number each item in sequence and 
describe each item in detail. Describe the instrument            General
(including any clause or paragraph number) or provision of       You must complete Schedule O and file it with the return if 
law under which each item passed to the surviving spouse.        you claim a deduction on item 22 of Part 5—Recapitulation.
Indicate the schedule and item number of each asset.
                                                                 You can claim the charitable deduction allowed under 
In listing otherwise nondeductible property for which you        section 2055 for the value of property in the decedent's gross 
are making a QTIP election, unless you specifically identify a   estate that was transferred by the decedent during life or by 
fractional portion of the trust or other property as not subject will to or for the use of any of the following.
to the election, the election will be considered made for the    • The United States, a state, a political subdivision of a 
entire interest.                                                   state, or the District of Columbia, for exclusively public 
                                                                   purposes.
Enter the value of each interest before taking into account      • Any corporation or association organized and operated 
the federal estate tax or any other death tax. The valuation       exclusively for religious, charitable, scientific, literary, or 
dates used in determining the value of the gross estate also       educational purposes, including the encouragement of 
apply on Schedule M.                                               art, or to foster national or international amateur sports 

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competition (but only if none of its activities involve If you are deducting the value of the residue or a part of
providing athletic facilities or equipment, unless the the residue passing to charity under the decedent's will,
organization is a qualified amateur sports organization) attach a copy of the computation showing how you
and the prevention of cruelty to children and animals. No determined the value, including any reduction for the taxes
part of the net earnings may benefit any private individual described earlier.
and no substantial activity may be undertaken to carry on
Also include the following.
propaganda, or otherwise attempt to influence legislation
or participate in any political campaign on behalf of any • A statement that shows the values of all specific and
general legacies or devises for both charitable and
candidate for public office.
noncharitable uses. For each legacy or devise, indicate
• A trustee or a fraternal society, order, or association
the paragraph or section of the decedent's will or codicil
operating under the lodge system, if the transferred
that applies. If legacies are made to each member of a
property is to be used exclusively for religious, charitable,
class (for example, $1,000 to each of the decedent's
scientific, literary, or educational purposes, or for the
employees), show only the number of each class and the
prevention of cruelty to children or animals. No
total value of property they received.
substantial activity may be undertaken to carry on
propaganda or otherwise attempt to influence legislation, • The dates of birth of all life tenants or annuitants, the
length of whose lives may affect the value of the interest
or participate in any political campaign on behalf of any
passing to charity under the decedent's will.
candidate for public office.
• Any veterans organization incorporated by an Act of • A statement showing the value of all property that is
included in the decedent's gross estate but does not
Congress or any of its departments, local chapters, or
pass under the will, such as transfers, jointly owned
posts, for which none of the net earnings benefits any
property that passed to the survivor on the decedent's
private individual.
death, and insurance payable to specific beneficiaries.
• Employee stock ownership plans, if the transfer qualifies
as a qualified gratuitous transfer of qualified employer • Any agreements with charitable beneficiaries, whether
entered before or after the date of death of the decedent.
securities within the meaning provided in section 664(g).
• Verification of the sale or purchase of property that is the
For this purpose, certain Indian tribal governments are subject of a charitable deduction.
treated as states and transfers to them qualify as deductible • Any other important information such as that relating to
charitable contributions. See section 7871 and Rev. Proc. any claim, not arising under the will, to any part of the
2008-55, 2008-39 I.R.B. 768, available at Rev. Proc. estate (that is, a spouse claiming dower or curtesy, or
2008-55, as modified and supplemented by subsequent similar rights).
revenue procedures, for a list of qualifying Indian tribal
governments. Line 2. Qualified Disclaimer
The charitable deduction is allowed for amounts that are
You may also claim a charitable contribution deduction for transferred to charitable organizations as a result of a
a qualifying conservation easement granted after the qualified disclaimer. To be a qualified disclaimer, a refusal to
decedent's death under the provisions of section 2031(c)(9). accept an interest in property must meet the conditions of
The charitable deduction is allowed for amounts that are section 2518. These are explained in Regulations sections
transferred to charitable organizations as a result of either a 25.2518-1 through 25.2518-3. If property passes to a
qualified disclaimer (see Line 2. Qualified Disclaimer, later) or charitable beneficiary as the result of a qualified disclaimer,
the complete termination of a power to consume, invade, or check the “Yes” box on line 2 and attach a copy of the written
appropriate property for the benefit of an individual. It does disclaimer required by section 2518(b).
not matter whether termination occurs because of the death
of the individual or in any other way. The termination must Attachments
occur within the period of time (including extensions) for filing If the charitable transfer was made by will, attach a certified
the decedent's estate tax return and before the power has copy of the order admitting the will to probate, in addition to
been exercised. the copy of the will. If the charitable transfer was made by any
other written instrument, attach a copy. If the instrument is of
The deduction is limited to the amount actually available record, the copy should be certified; if not, the copy should
for charitable uses. Therefore, if under the terms of a will or be verified.
the provisions of local law, or for any other reason, the federal
estate tax, the federal GST tax, or any other estate, GST, Value
succession, legacy, or inheritance tax is payable in whole or The valuation dates used in determining the value of the
in part out of any bequest, legacy, or devise that would gross estate also apply on Schedule O.
otherwise be allowed as a charitable deduction, the amount
you may deduct is the amount of the bequest, legacy, or
devise reduced by the total amount of the taxes. Schedule P—Credit for Foreign Death
If you elected to make installment payments of the estate Taxes
tax, and the interest is payable out of property transferred to
charity, you must reduce the charitable deduction by an General
estimate of the maximum amount of interest that will be paid If you claim a credit on Part 2—Tax Computation, line 13,
on the deferred tax. complete Schedule P and file it with the return. Attach
Form(s) 706-CE to Form 706 to support any credit you claim.
For split-interest trusts or pooled income funds, only the
figure that is passing to the charity should be entered in the If the foreign government refuses to certify Form 706-CE,
“Amount” column. Do not enter the entire amount that passes file it directly with the IRS as instructed on the Form 706-CE.
to the trust or fund. See Form 706-CE for instructions on how to complete the

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form and a description of the items that must be attached to of the federal estate tax. See the Instructions for Form
the form when the foreign government refuses to certify it. 706-NA.

The credit for foreign death taxes is allowable only if the Computation of Credit Under the Statute
decedent was a citizen or resident of the United States.
However, see section 2053(d) and the related regulations for Item 1. Enter the amount of the estate, inheritance, legacy,
exceptions and limitations if the executor has elected, in and succession taxes paid to the foreign country and its
certain cases, to deduct these taxes from the value of the possessions or political subdivisions, attributable to property
gross estate. For a resident not a citizen, who was a citizen or that is:
subject of a foreign country for which the President has • Situated in that country,
issued a proclamation under section 2014(h), the credit is • Subjected to these taxes, and
allowable only if the country of which the decedent was a • Included in the gross estate.
national allows a similar credit to decedents who were U.S. The amount entered on item 1 should not include any tax
citizens residing in that country. paid to the foreign country for property not situated in that
The credit is authorized either by statute or by treaty. If a country and should not include any tax paid to the foreign
credit is authorized by a treaty, whichever of the following is country for property not included in the gross estate. If only a
the most beneficial to the estate is allowed. part of the property subjected to foreign taxes is both situated
• The credit figured under the treaty. in the foreign country and included in the gross estate, it will
• The credit figured under the statute. be necessary to determine the portion of the taxes
• The credit figured under the treaty, plus the credit figured attributable to that part of the property. Also, attach the
under the statute for death taxes paid to each political computation of the amount entered on item 1.
subdivision or possession of the treaty country that are Item 2. Enter the value of the gross estate, less the total of
not directly or indirectly creditable under the treaty. the deductions on items 21 and 22 of Part 5—Recapitulation.
Under the statute, the credit is authorized for all death Item 3. Enter the value of the property situated in the foreign
taxes (national and local) imposed in the foreign country. country that is subjected to the foreign taxes and included in
Whether local taxes are the basis for a credit under a treaty the gross estate, less those portions of the deductions taken
depends upon the provisions of the particular treaty. on Schedules M and O that are attributable to the property.
If a credit for death taxes paid in more than one foreign Item 4. Subtract any credit claimed on line 15 for federal gift
country is allowable, a separate computation of the credit taxes on pre-1977 gifts (section 2012) from line 12 of Part
must be made for each foreign country. The copies of 2—Tax Computation, and enter the balance on item 4 of
Schedule P on which the additional computations are made Schedule P.
should be attached to the copy of Schedule P provided in the
return. Credit Under Treaties
The total credit allowable for any property, whether If you are reporting any items on this return based on the
subjected to tax by one or more than one foreign country, is provisions of a death tax treaty, you may have to attach a
limited to the amount of the federal estate tax attributable to statement to this return disclosing the return position that is
the property. The anticipated amount of the credit may be treaty based. See Regulations section 301.6114-1 for details.
figured on the return, but the credit cannot finally be allowed In general. If the provisions of a treaty apply to the estate of
until the foreign tax has been paid and a Form 706-CE a U.S. citizen or resident, a credit is authorized for payment of
evidencing payment is filed. Section 2014(g) provides that for the foreign death tax or taxes specified in the treaty. Treaties
credits for foreign death taxes, each U.S. territory is deemed with death tax conventions are in effect with the following
a foreign country. countries: Australia, Austria, Canada, Denmark, Finland,
Convert death taxes paid to the foreign country into U.S. France, Germany, Greece, Ireland, Italy, Japan, the
dollars by using the rate of exchange in effect at the time Netherlands, South Africa, Switzerland, and the United
each payment of foreign tax is made. Kingdom.
If a credit is claimed for any foreign death tax that is later A credit claimed under a treaty is in general figured on
recovered, see Regulations section 20.2016-1 for the notice Schedule P in the same manner as the credit is figured under
required within 30 days. the statute with the following principal exceptions.
• The situs rules contained in the treaty apply in
Limitation Period determining whether property was situated in the foreign
country.
The credit for foreign death taxes is limited to those taxes that The credit may be allowed only for payment of the death
•
were actually paid and for which a credit was claimed within tax or taxes specified in the treaty (but see the
the later of 4 years after the filing of the estate tax return, instructions earlier for credit under the statute for death
before the date of expiration of any extension of time for taxes paid to each political subdivision or possession of
payment of the federal estate tax, or 60 days after a final the treaty country that are not directly or indirectly
decision of the Tax Court on a timely filed petition for a creditable under the treaty).
redetermination of a deficiency. If specifically provided, the credit is proportionately
•
shared for the tax applicable to property situated outside
Credit Under the Statute
both countries, or that was deemed in some instances
For the credit allowed by the statute, the question of whether situated within both countries.
particular property is situated in the foreign country imposing • The amount entered on item 4 of Schedule P is the
the tax is determined by the same principles that would apply amount shown on line 12 of Part 2—Tax Computation,
in determining whether similar property of a nonresident not a less the total of the credits claimed for federal gift taxes
U.S. citizen is situated within the United States for purposes

Instructions for Form 706 (Rev. 10-2024) 43

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on pre-1977 gifts (section 2012) and for tax on prior Maximum Amount of the Credit
transfers (line 14 of Part 2—Tax Computation). (If a credit The maximum amount of the credit is the smaller of:
is claimed for tax on prior transfers, it will be necessary to
complete Schedule Q before completing Schedule P.) 1. The amount of the estate tax of the transferor's estate
For examples of computations of credits under the attributable to the transferred property, or
treaties, see the applicable regulations.
2. The amount by which:
Note. For computation of credit, in cases where property is a. An estate tax on the transferee's estate determined
situated outside both countries or deemed situated within without the credit for tax on prior transfers exceeds
both countries, see the appropriate treaty for details.
b. An estate tax on the transferee's estate determined
by excluding from the gross estate the net value of
Schedule Q—Credit for Tax on Prior the transfer.
Transfers If credit for a particular foreign death tax may be taken under
either the statute or a death duty convention, and on this
General return the credit actually is taken under the convention, then
Complete Schedule Q and file it with the return if you claim a no credit for that foreign death tax may be taken into
credit on Part 2—Tax Computation, line 14. consideration in figuring estate tax (2a) or estate tax (2b)
above.
The term “transferee” means the decedent for whose
estate this return is filed. If the transferee received property Percent Allowable
from a transferor who died within 10 years before, or 2 years
Where transferee predeceased the transferor. If not
after, the transferee, a credit is allowable on this return for all
more than 2 years elapsed between the dates of death, the
or part of the federal estate tax paid by the transferor's estate
credit allowed is 100% of the maximum amount. If more than
for the transfer. There is no requirement that the property be
2 years elapsed between the dates of death, no credit is
identified in the estate of the transferee or that it exist on the
allowed.
date of the transferee's death. It is sufficient for the allowance
of the credit that the transfer of the property was subjected to Where transferor predeceased the transferee. The
federal estate tax in the estate of the transferor and that the percent of the maximum amount that is allowed as a credit
specified period of time has not elapsed. A credit may be depends on the number of years that elapsed between dates
allowed for property received as the result of the exercise or of death. It is determined using the following table.
nonexercise of a power of appointment when the property is
included in the gross estate of the donee of the power. Period of Time Percent
Exceeding Not Exceeding Allowable
If the transferee was the transferor's surviving spouse, no - - - - - 2 years 100
credit is allowed for property received from the transferor to 2 years 4 years 80
the extent that a marital deduction was allowed to the 4 years 6 years 60
transferor's estate for the property. There is no credit for tax 6 years 8 years 40
on prior transfers for federal gift taxes paid in connection with 8 years 10 years 20
the transfer of the property to the transferee. 10 years - - - - - none

If you are claiming a credit for tax on prior transfers on
Form 706-NA, you should first complete and attach Part
How To Figure the Credit
5—Recapitulation from Form 706 before figuring the credit on
Schedule Q from Form 706. A worksheet for Schedule Q is provided to allow you to figure
the limits before completing Schedule Q. Transfer the
Section 2056(d)(3) contains specific rules for allowing a appropriate amounts from the worksheet to Schedule Q as
credit for certain transfers to a spouse who was not a U.S. indicated on the schedule. You do not need to file the
citizen where the property passed outright to the spouse, or worksheet with Form 706, but keep it for your records.
to a qualified domestic trust. Cases involving transfers from two or more transferors.
Part I of the worksheet and Schedule Q enable you to figure
Property the credit for as many as three transferors. The number of
The term “property” includes any interest (legal or equitable) transferors is irrelevant to Part II of the worksheet. If you are
of which the transferee received the beneficial ownership. figuring the credit for more than three transferors, use more
The transferee is considered the beneficial owner of property than one worksheet and Schedule Q, Part I, and combine the
over which the transferee received a general power of totals for the appropriate lines.
appointment. Property does not include interests to which the
transferee received only a bare legal title, such as that of a Section 2032A additional tax. If the transferor's estate
trustee. Neither does it include an interest in property over elected special-use valuation and the additional estate tax of
which the transferee received a power of appointment that is section 2032A(c) was imposed at any time up to 2 years after
not a general power of appointment. In addition to interests in the death of the decedent for whom you are filing this return,
which the transferee received the complete ownership, the check the box on Schedule Q. On lines 1 and 9 of the
credit may be allowed for annuities, life estates, terms for worksheet, include the property subject to the additional
years, remainder interests (whether contingent or vested), estate tax at its FMV rather than its special-use value. On
and any other interest that is less than the complete line 10 of the worksheet, include the additional estate tax
ownership of the property, to the extent that the transferee paid as a federal estate tax paid.
became the beneficial owner of the interest.

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How To Complete the Schedule Q Worksheet amount of any credit taken (on line 15) for federal gift taxes
Most of the information to complete Part I of the worksheet on pre-1977 gifts (section 2012). Subtract this total from Part
should be obtained from the transferor's Form 706. 2—Tax Computation, line 8. Enter the result on line 21 of the
worksheet.
Line 5. Enter on line 5 the applicable marital deduction
claimed for the transferor's estate (from the transferor's Form Line 26. If you figured the marital deduction using the
706). unlimited marital deduction in effect for decedents dying after
1981, for purposes of determining the marital deduction for
Lines 10 through 18. Enter on these lines the appropriate the reduced gross estate, see Rev. Rul. 90-2, 1990-1 C.B.
taxes paid by the transferor's estate. 169. To determine the “reduced adjusted gross estate,”
If the transferor's estate elected to pay the federal estate subtract the amount on line 25 of the Worksheet for
tax in installments, enter on line 10 only the total of the Schedule Q from the amount on line 24 of the worksheet. If
installments that have actually been paid at the time you file community property is included in the amount on line 24 of
this Form 706. See Rev. Rul. 83-15, 1983-1 C.B. 224, for the worksheet, figure the reduced adjusted gross estate
more details. using the rules of Regulations section 20.2056(c)-2 and Rev.
Rul. 76-311, 1976-2 C.B. 261.
Line 21. Add lines 11 (allowable applicable credit) and 13
(foreign death taxes credit) of Part 2—Tax Computation to the

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Worksheet for Schedule Q—Credit for Tax on Prior Transfers
Part I  Transferor’s tax on prior transfers
                                                                                                               Transferor (From Schedule Q)                                  Total for all transfers
                                     Item                                                                                                                                          (line 8 only)
                                                                                                   A                         B                             C
1.      Gross value of prior transfer to this transferee   . . . . . . . . . . . . .
2.      Death taxes payable from prior transfer .    . . . . . . . . . . . . . . . .
3.      Encumbrances allocable to prior transfer .     . . . . . . . . . . . . . . .
4.      Obligations allocable to prior transfer  . . . . . . . . . . . . . . . . . .
5.      Marital deduction applicable to line 1 above, as shown on transferor’s 
        Form 706 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
6.      TOTAL. Add lines 2, 3, 4, and 5    . . . . . . . . . . . . . . . . . . . . .
7.      Net value of transfers. Subtract line 6 from line 1      . . . . . . . . . .
8.      Net value of transfers. Add columns A, B, and C of line 7 .        . . . . .
9.      Transferor’s tentative taxable estate (see line 3a, page 1, Form 
        706) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
10.     Federal estate tax paid  . . . . . . . . . . . . . . . . . . . . . . . . . .
11.     State death taxes paid . . . . . . . . . . . . . . . . . . . . . . . . . . .
12.     Foreign death taxes paid   . . . . . . . . . . . . . . . . . . . . . . . . .
13.     Other death taxes paid   . . . . . . . . . . . . . . . . . . . . . . . . . .
14.     TOTAL taxes paid. Add lines 10, 11, 12, and 13         . . . . . . . . . . .
15.     Value of transferor’s estate. Subtract line 14 from line 9       . . . . . .
16.     Net federal estate tax paid on transferor’s estate .   . . . . . . . . . . .
17.     Credit for gift tax paid on transferor’s estate with respect to pre-1977 
        gifts (section 2012) . . . . . . . . . . . . . . . . . . . . . . . . . . . .
18.     Credit allowed transferor’s estate for tax on prior transfers from prior 
        transferor(s) who died within 10 years before death of 
        decedent . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
19.     Tax on transferor’s estate. Add lines 16, 17, and 18 .       . . . . . . . .
20.     Transferor’s tax on prior transfers ((line 7 ÷ line 15) × line 19 of 
        respective estates)  . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Part II Transferee’s tax on prior transfers
                                                                               Item                                                                                                Amount
21.     Transferee’s actual tax before allowance of credit for prior transfers (see instructions)      . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .   21.
22.     Total gross estate of transferee from line 1 of the Tax Computation, page 1, Form 706          . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .   22.
23.     Net value of all transfers from line 8 of this worksheet .   . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 23.
24.     Transferee’s reduced gross estate. Subtract line 23 from line 22 .       . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 24.
25.     Total debts and deductions (not including marital and charitable deductions) (line 3b of Part 2—Tax 
        Computation, page 1; and items 18, 19, and 20 of the Recapitulation, page 3, Form 706)             . . . . . . . . . .           25.
26.     Marital deduction from item 21, Recapitulation, page 3, Form 706 (see instructions)          . . . . . . . . . . . . .           26.
27.     Charitable bequests from item 22, Recapitulation, page 3, Form 706 .          . . . . . . . . . . . . . . . . . . . . .          27.
28.     Charitable deduction proportion ([line 23 ÷ (line 22 – line 25)] × line 27)    . . . . . . . . . . . . . . . . . . . .           28.
29.     Reduced charitable deduction. Subtract line 28 from line 27 .        . . . . . . . . . . . . . . . . . . . . . . . . . .         29.
30.     Transferee’s deduction as adjusted. Add lines 25, 26, and 29         . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 30.
31. (a) Transferee’s reduced taxable estate. Subtract line 30 from line 24 .       . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 31(a).
    (b) Adjusted taxable gifts . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 31(b).
    (c) Total reduced taxable estate. Add lines 31(a) and 31(b)        . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 31(c).
32.     Tentative tax on reduced taxable estate .    . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .         32.
33. (a) Post-1976 gift taxes paid  . . . . . . . . . . . . . . . . . . . . . . . . .       33(a).
    (b) Unified credit (applicable credit amount)    . . . . . . . . . . . . . . . .       33(b).
    (c) Section 2012 gift tax credit . . . . . . . . . . . . . . . . . . . . . . . .       33(c).
    (d) Section 2014 foreign death tax credit    . . . . . . . . . . . . . . . . . .       33(d).
    (e) Total credits. Add lines 33(a) through 33(d) .   . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .     33(e).
34.     Net tax on reduced taxable estate. Subtract line 33(e) from line 32        . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 34.
35.     Transferee’s tax on prior transfers. Subtract line 34 from line 21     . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 35.

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property transferred on behalf of the decedent during life and
Schedules R and after October 21, 1986). The GST tax will also not apply to
any transfer under a trust to the extent that the trust consists
R-1—Generation-Skipping Transfer of property included in the gross estate (other than property
Tax transferred on behalf of the decedent during life and after
October 21, 1986).
Introduction and Overview Under a mental disability means the decedent lacked the
Schedule R is used to figure the generation-skipping transfer competence to execute an instrument governing the
(GST) tax that is payable by the estate. Schedule R-1 is used disposition of property owned, regardless of whether there
to figure the GST tax that is payable by certain trusts that are was an adjudication of incompetence or an appointment of
includible in the gross estate. any other person charged with the care of the person or
property of the transferor.
The GST tax reported on Form 706 is imposed on only If the decedent had been adjudged mentally incompetent,
direct skips occurring at death. Unlike the estate tax, which is a copy of the judgment or decree must be filed with this
imposed on the value of the entire taxable estate regardless return.
of who receives it, the GST tax is imposed on only the value
of interests in property, wherever located, that actually pass If the decedent had not been adjudged mentally
to certain transferees, who are referred to as skip persons incompetent, the executor must file with the return a
(defined later). certification from a qualified physician stating that in the
physician’s opinion the decedent had been mentally
For purposes of Form 706, the property interests incompetent at all times on and after October 22, 1986, and
transferred must be includible in the gross estate before they that the decedent had not regained the competence to
are subject to the GST tax. Therefore, the first step in figuring modify or revoke the terms of the trust or will prior to the
the GST tax liability is to determine the property interests decedent’s death or a statement as to why no such
includible in the gross estate by completing Schedules A certification may be obtained from a physician.
through I of Form 706.
Direct skip. The GST tax reported on Form 706 and
The second step is to determine who the skip persons are. Schedule R-1 is imposed only on direct skips. For purposes
To do this, assign each transferee to a generation and of Form 706, a direct skip is a transfer that is:
determine whether each transferee is a natural person or a • Subject to the estate tax,
trust for GST purposes. See section 2613 and Regulations • Of an interest in property, and
section 26.2612-1(d) for details. • To a skip person.
The third step is to determine which skip persons are All three requirements must be met before the transfer is
transferees of interests in property. If the skip person is a subject to the GST tax. A transfer is subject to the estate tax if
natural person, anything transferred is an interest in property. you are required to list it on any of Schedules A through I of
If the skip person is a trust, make this determination using the Form 706. To determine if a transfer is of an interest in
rules under Interest in property, later. These first three steps property and to a skip person, you must first determine if the
are described in detail under Determining Which Transfers transferee is a natural person or a trust, as defined later.
Are Direct Skips, later. Trust. For purposes of the GST tax, a trust includes not only
The fourth step is to determine whether to enter the an ordinary trust (as defined in Special rule for trusts other
transfer on Schedule R or on Schedule R-1. See the rules than ordinary trusts, later), but also any other arrangement
under Dividing Direct Skips Between Schedules R and R-1, (other than an estate) which, although not explicitly a trust,
later. has substantially the same effect as a trust. For example, a
trust includes life estates with remainders, terms for years,
The fifth step is to complete Schedules R and R-1 using and insurance and annuity contracts.
the How To Complete instructions for each schedule. Substantially separate and independent shares of different
beneficiaries in a trust are treated as separate trusts.
Determining Which Transfers Are Direct Skips
Interest in property. If a transfer is made to a natural
Effective dates. The rules below apply only for the purpose person, it is always considered a transfer of an interest in
of determining if a transfer is a direct skip that should be property for purposes of the GST tax.
reported on Schedule R or R-1 of Form 706.
In general. The GST tax is effective for the estates of If a transfer is made to a trust, a person will have an
decedents dying after October 22, 1986. interest in the property transferred to the trust if that person
either has a present right to receive income or corpus from
Irrevocable trusts. The GST tax will not apply to any the trust (such as an income interest for life) or is a
transfer under a trust that was irrevocable on September 25, permissible current recipient of income or corpus from the
1985, but only to the extent that the transfer was not made trust (that is, may receive income or corpus at the discretion
out of corpus added to the trust after September 25, 1985. of the trustee).
An addition to the corpus after that date will cause a
proportionate part of future income and appreciation to be Skip person. A transferee who is a natural person is a skip
subject to the GST tax. For more information, see person if that transferee is assigned to a generation that is
Regulations section 26.2601-1(b)(1). two or more generations below the generation assignment of
Mental disability. If, on October 22, 1986, the decedent the decedent. See Determining the generation of a
was under a mental disability to change the disposition of transferee, later.
property owned and did not regain the competence to A transferee who is a trust is a skip person if all the
dispose of property before death, the GST tax will not apply interests in the property (as defined above) transferred to the
to any property included in the gross estate (other than

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trust are held by skip persons. Thus, whenever a non-skip and transfers after December 31, 1997, the existing rule that
person has an interest in a trust, the trust will not be a skip applied to grandchildren of the decedent has been extended
person even though a skip person also has an interest in the to apply to other lineal descendants.
trust. If property is transferred to an individual who is a
A trust will also be a skip person if there are no interests in descendant of a parent of the transferor, and that individual's
the property transferred to the trust held by any person, and parent (who is a lineal descendant of the parent of the
future distributions or terminations from the trust can be transferor) is deceased at the time the transfer is subject to
made only to skip persons. gift or estate tax, then for purposes of generation assignment,
the individual is treated as if the individual is a member of the
Non-skip person. A non-skip person is any transferee who
generation that is one generation below the lower of:
is not a skip person.
• The transferor's generation; or
Determining the generation of a transferee. Generally, a • The generation assignment of the youngest living
generation is determined along family lines as follows. ancestor of the individual, who is also a descendant of
the parent of the transferor.
1. Where the beneficiary is a lineal descendant of a
grandparent of the decedent (that is, the decedent's The same rules apply to the generation assignment of any
cousin, niece, nephew, etc.), the number of generations descendant of the individual.
between the decedent and the beneficiary is determined This rule does not apply to a transfer to an individual who
by subtracting the number of generations between the is not a lineal descendant of the transferor if the transferor
grandparent and the decedent from the number of has any living lineal descendants.
generations between the grandparent and the
If any transfer of property to a trust would have been a
beneficiary.
direct skip except for this generation assignment rule, then
2. Where the beneficiary is a lineal descendant of a the rule also applies to transfers from the trust attributable to
grandparent of a spouse (or former spouse) of the such property.
decedent, the number of generations between the See the examples in Regulations section 26.2651-1(c).
decedent and the beneficiary is determined by Generation assignment under Notice 2017-15. Notice
subtracting the number of generations between the 2017-15 permits taxpayers to reduce their GST exemption
grandparent and the spouse (or former spouse) from the allocated to transfers that were made to or for the benefit of
number of generations between the grandparent and the transferees whose generation assignment is changed as a
beneficiary. result of the Windsor decision. A taxpayer’s GST exemption
3. A person who at any time was married to a person that was allocated to a transfer to (or to a trust for the sole
described in (1) or (2) above is assigned to the benefit of) one or more transferees whose generation
generation of that person. A person who at any time was assignment should have been determined on the basis of a
married to the decedent is assigned to the decedent's familial relationship as the result of the Windsor decision, and
generation. are non-skip persons, is deemed void. For additional
information, go to IRS.gov/Businesses/Small-Businesses-
4. A relationship by adoption or half-blood is treated as a Self-Employed/Estate-and-Gift-Taxes.
relationship by whole-blood. Ninety-day rule. For purposes of determining if an
5. A person who is not assigned to a generation according individual's parent is deceased at the time of a testamentary
to (1), (2), (3), or (4) above is assigned to a generation transfer, an individual's parent who dies no later than 90 days
based on the birth date, as follows. after a transfer occurring by reason of the death of the
transferor is treated as having predeceased the transferor.
a. A person who was born not more than 12 / years 1 2 The 90-day rule applies to transfers occurring on or after July
after the decedent is in the decedent's generation. 18, 2005. See Regulations section 26.2651-1 for more
b. A person born more than 12 / years, but not more 1 2 information.
than 37 / years, after the decedent is in the first 1 2 Charitable organizations. Charitable organizations and
generation younger than the decedent. trusts described in sections 511(a)(2) and 511(b)(2) are
assigned to the decedent's generation. Transfers to such
c. A similar rule applies for a new generation every 25 organizations are therefore not subject to the GST tax.
years. Charitable remainder trusts. Transfers to or in the form
If more than one of the rules for assigning generations of charitable remainder annuity trusts, charitable remainder
applies to a transferee, that transferee is generally assigned unitrusts, and pooled income funds are not considered made
to the youngest of the generations that would apply. to skip persons and, therefore, are not direct skips even if all
If an estate, trust, partnership, corporation, or other entity of the life beneficiaries are skip persons.
(other than certain charitable organizations and trusts Estate tax value. Estate tax value is the value shown on
described in sections 511(a)(2) and 511(b)(2)) is a Schedules A through I of this Form 706.
transferee, then each person who indirectly receives the Examples. The rules above can be illustrated by the
property interests through the entity is treated as a transferee following examples.
and is assigned to a generation, as explained in the above
rules. However, this look-through rule does not apply for the 1. Under the will, the decedent's house is transferred to the
purpose of determining whether a transfer to a trust is a direct decedent's child for the child’s life, with the remainder
skip. passing to the child’s children. This transfer is made to a
Generation assignment where intervening parent is “trust” even though there is no explicit trust instrument.
deceased. A special rule may apply in the case of the death The interest in the property transferred (the present right
of a parent of the transferee. For terminations, distributions, to use the house) is transferred to a non-skip person (the

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decedent's child). Therefore, the trust is not a skip declaration whereby trustees take title to property for the
person because there is an interest in the transferred purpose of protecting or conserving it for the beneficiaries
property that is held by a non-skip person. The transfer is under the ordinary rules applied in chancery or probate
not a direct skip. courts.” Direct skips from ordinary trusts are required to be
reported on Schedule R-1 regardless of their size unless the
2. The will bequeaths $100,000 to the decedent's
executor is also a trustee (see Executor as trustee below).
grandchild. This transfer is a direct skip that is not made
in trust and should be shown on Schedule R. Direct skips from trusts that are trusts for GST tax
purposes but are not ordinary trusts are to be shown on
3. The will establishes a trust that is required to accumulate Schedule R-1 only if the total of all tentative maximum direct
income for 10 years and then pay its income to the skips from the entity is $250,000 or more. If this total is less
decedent's grandchildren for the rest of their lives and, than $250,000, the skips should be shown on Schedule R.
upon their deaths, distribute the corpus to the decedent's For purposes of the $250,000 limit, tentative maximum direct
great-grandchildren. Because the trust has no current skips is the amount you would enter on line 5 of
beneficiaries, there are no present interests in the Schedule R-1 if you were to file that schedule.
property transferred to the trust. All of the persons to
A liquidating trust (such as a bankruptcy trust) under
whom the trust can make future distributions (including
Regulations section 301.7701-4(d) is not treated as an
distributions upon the termination of interests in property
ordinary trust for the purposes of this special rule.
held in trust) are skip persons (for example, the
decedent's grandchildren and great-grandchildren). If the proceeds of a life insurance policy are includible in
Therefore, the trust itself is a skip person and you should the gross estate and are payable to a beneficiary who is a
show the transfer on Schedule R. skip person, the transfer is a direct skip from a trust that is not
an ordinary trust. It should be reported on Schedule R-1 if the
4. The will establishes a trust that is to pay all of its income total of all the tentative maximum direct skips from the
to the decedent's grandchildren for 10 years. At the end company is $250,000 or more. Otherwise, it should be
of 10 years, the corpus is to be distributed to the reported on Schedule R.
decedent's children. All of the present interests in this
Similarly, if an annuity is includible on Schedule I and its
trust are held by skip persons. Therefore, the trust is a
survivor benefits are payable to a beneficiary who is a skip
skip person and you should show this transfer on
person, then the estate tax value of the annuity should be
Schedule R. You should show the estate tax value of all
reported as a direct skip on Schedule R-1 if the total tentative
the property transferred to the trust even though the trust
maximum direct skips from the entity paying the annuity are
has some ultimate beneficiaries who are non-skip
$250,000 or more.
persons.
Executor as trustee. If any of the executors of the
Dividing Direct Skips Between Schedules R and decedent's estate are trustees of the trust, then all direct
R-1 skips for that trust must be shown on Schedule R and not on
Schedule R-1, even if they would otherwise have been
Report all generation-skipping transfers on required to be shown on Schedule R-1. This rule applies
TIP Schedule R unless the rules below specifically even if the trust has other trustees who are not executors of
provide that they are to be reported on Schedule R-1. the decedent's estate.
Under section 2603(a)(2), the GST tax on direct skips
from a trust (as defined for GST tax purposes) is to be paid How To Complete Schedules R and R-1
by the trustee and not by the estate. Schedule R-1 serves as Valuation. Enter on Schedules R and R-1 the estate tax
a notification from the executor to the trustee that a GST tax value of the property interests subject to the direct skips. If
is due. you elected alternate valuation (section 2032) and/or
For a direct skip to be reportable on Schedule R-1, the special-use valuation (section 2032A), you must use the
trust must be includible in the decedent's gross estate. alternate and/or special-use values on Schedules R and R-1.

If the decedent was a surviving spouse receiving lifetime How To Complete Schedule R
benefits from a marital deduction power of appointment (or Part 1. GST Exemption Reconciliation
QTIP) trust created by the decedent's spouse, then transfers
caused by reason of the decedent's death from that trust to Part 1, line 6, of both Parts 2 and 3, and line 4 of
skip persons are direct skips required to be reported on Schedule R-1 are used to allocate the decedent's GST
Schedule R-1. exemption. This allocation is made by filing Form 706 and
If a direct skip is made “from a trust” under these rules, it is attaching a completed Schedule R and/or R-1. Once made,
reportable on Schedule R-1 even if it is also made “to a trust” the allocation is irrevocable. You are not required to allocate
rather than to an individual. all of the decedent's GST exemption. However, the portion of
the exemption that you do not allocate will be allocated by the
Similarly, if property in a trust (as defined for GST tax IRS under the deemed allocation of unused GST exemption
purposes) is included in the decedent's gross estate under rules of section 2632(e).
section 2035, 2036, 2037, 2038, 2039, 2041, or 2042 and
such property is, by reason of the decedent's death, For transfers made through 1998, the GST exemption was
transferred to skip persons, the transfers are direct skips $1 million. The current GST exemption is $13,610,000. The
required to be reported on Schedule R-1. exemption amounts for 1999 through 2024 are as follows.
Special rule for trusts other than ordinary trusts. An
ordinary trust is defined in Regulations section 301.7701-4(a)
as “an arrangement created by a will or by an inter vivos

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Year of transfer GST exemption Line 2. These allocations will have been made either on
1999 $1,010,000 Forms 709 filed by the decedent or on Notices of Allocation
made by the decedent for inter vivos transfers that were not
2000 $1,030,000 direct skips but to which the decedent allocated the GST
2001 $1,060,000 exemption. These allocations by the decedent are
2002 $1,100,000 irrevocable.
2003 $1,120,000 Also include on this line allocations deemed to have been
made by the decedent under the rules of section 2632.
2004 and 2005 $1,500,000 Unless the decedent elected out of the deemed allocation
2006, 2007, and 2008 $2,000,000 rules, allocations are deemed to have been made in the
2009 $3,500,000 following order.
2010 and 2011 $5,000,000 1. To inter vivos direct skips.
2012 $5,120,000 2. Beginning with transfers made after December 31, 2000,
2013 $5,250,000 to lifetime transfers to certain trusts, by the decedent,
that constituted indirect skips that were subject to the gift
2014 $5,340,000 tax.
2015 $5,430,000 For more information, see section 2632 and related
2016 $5,450,000 regulations.
2017 $5,490,000 Line 3. Make an entry on this line if you are filing Form(s)
2018 $11,180,000 709 for the decedent and wish to allocate any exemption.
2019 $11,400,000 Lines 4, 5, and 6. These lines represent your allocation of
2020 $11,580,000 the GST exemption to direct skips made by reason of the
decedent's death. Complete Parts 2 and 3 and Schedule R-1
2021 $11,700,000 before completing these lines.
2022 $12,060,000 Line 9. Line 9 is used to allocate the remaining unused GST
2023 $12,920,000 exemption (from line 8) and to help you figure the trust's
2024 $13,610,000 inclusion ratio. Line 9 is a Notice of Allocation for allocating
the GST exemption to trusts as to which the decedent is the
transferor and from which a GST could occur after the
decedent's death.
The amount of each increase can only be allocated to If line 9 is not completed, the deemed allocation at death
transfers made (or appreciation that occurred) during or after rules will apply to allocate the decedent's remaining unused
the year of the increase. The following example shows the GST exemption. The exemption will first be allocated to
application of this rule. property that is the subject of a direct skip occurring at the
Example. In 2003, Alex made a direct skip of $1,120,000 decedent's death, and then to trusts as to which the
and applied the full $1,120,000 of GST exemption to the decedent is the transferor. To avoid the application of the
transfer. Alex made a $450,000 taxable direct skip in 2004 deemed allocation rules, you should enter on line 9 every
and another of $90,000 in 2006. For 2004, Alex can only trust (except certain trusts entered on Schedule R-1, as
apply $380,000 of exemption ($380,000 inflation adjustment described later) to which you wish to allocate any part of the
from 2004) to the $450,000 transfer in 2004. For 2006, Alex decedent's GST exemption. Unless you enter a trust on
can apply $90,000 of exemption to the 2006 transfer, but line 9, the unused GST exemption will be allocated to it under
nothing to the transfer made in 2004. At the end of 2006, Alex the deemed allocation rules.
would have $410,000 of unused exemption that can apply to If a trust is entered on Schedule R-1, the amount you
future transfers (or appreciation) starting in 2007. entered on line 4 of Schedule R-1 serves as a Notice of
Special QTIP election. In the case of property for which a Allocation and you need not enter the trust on line 9 unless
marital deduction is allowed to the decedent's estate under you wish to allocate more than the Schedule R-1, line 4,
section 2056(b)(7) (QTIP election), section 2652(a)(3) allows amount to the trust. However, you must enter the trust on
you to treat such property for purposes of the GST tax as if line 9 if you wish to allocate any of the unused GST
the election to be treated as qualified terminable interest exemption amount to it. Such an additional allocation would
property had not been made. not ordinarily be appropriate in the case of a trust entered on
Schedule R-1 when the trust property passes outright (rather
The section 2652(a)(3) election must include the value of
than to another trust) at the decedent's death. However,
all property in the trust for which a QTIP election was allowed
where section 2032A property is involved, it may be
under section 2056(b)(7).
appropriate to allocate additional exemption amounts to the
If a section 2652(a)(3) election is made, then the decedent property. See the instructions for line 10, later.
will, for GST tax purposes, be treated as the transferor of all
the property in the trust for which a marital deduction was To avoid application of the deemed allocation rules,
allowed to the decedent's estate under section 2056(b)(7). In ! Form 706 and Schedule R should be filed to allocate
this case, the executor of the decedent's estate may allocate CAUTION the exemption to trusts that may later have taxable
part or all of the decedent's GST exemption to the property. terminations or distributions under section 2612 even if the
form is not required to be filed to report estate or GST tax.
You make the election simply by listing qualifying property
on line 9 of Part 1.

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Line 9, column C. Enter the GST exemption, included on death rules. To the extent any amount is not so allocated, it
lines 2 through 6 of Part 1 of Schedule R (discussed above), will be automatically allocated to the earliest disposition or
that was allocated to the trust. cessation that is subject to the GST tax. Under certain
Line 9, column D. Allocate the amount on line 8 of Part 1 circumstances, post-death events may cause the decedent
of Schedule R in line 9, column D. This amount may be to be treated as a transferor for purposes of chapter 13.
allocated to transfers into trusts that are not otherwise Line 10 may be used to set aside an exemption amount for
reported on Form 706. For example, the line 8 amount may such an event. Attach a statement listing each such event
be allocated to an inter vivos trust established by the and the amount of exemption allocated to that event.
decedent during the decedent’s lifetime and not included in
the gross estate. This allocation is made by identifying the Parts 2 and 3
trust on line 9 and making an allocation to it using column D.
If the trust is not included in the gross estate, value the trust Use Part 2 to figure the GST tax on transfers in which the
as of the date of death. Inform the trustee of each trust listed property interests transferred are to bear the GST tax on the
on line 9 of the total GST exemption you allocated to the trust. transfers. Use Part 3 to report the GST tax on transfers in
The trustee will need this information to figure the GST tax on which the property interests transferred do not bear the GST
future distributions and terminations. tax on the transfers.
Line 9, column E. Trust's inclusion ratio. The trustee
must know the trust's inclusion ratio to figure the trust's GST Section 2603(b) requires that, unless the governing
tax for future distributions and terminations. You are not instrument provides otherwise, the GST tax is to be charged
required to inform the trustee of the inclusion ratio and may to the property constituting the transfer. Therefore, you will
not have enough information to figure it. Therefore, you are usually enter all of the direct skips on Part 2.
not required to make an entry in column E. However, column
E and the worksheet later are provided to assist you in You may enter a transfer on Part 3 only if the will or trust
figuring the inclusion ratio for the trustee if you wish to do so. instrument directs, by specific reference, that the GST tax is
Inform the trustee of the amount of the GST exemption you not to be paid from the transferred property interests.
allocated to the trust. Line 9, columns C and D, may be used Part 2, line 3. Enter zero on this line unless the will or trust
to figure this amount for each trust. instrument specifies that the GST taxes will be paid by
property other than that constituting the transfer (as
Note. This worksheet will figure an accurate inclusion ratio described above). Enter on line 3 the total of the GST taxes
only if the decedent was the only settlor of the trust. Use a shown on Part 3 and Schedule(s) R-1 that are payable out of
separate worksheet for each trust (or a separate share of a the property interests shown on Part 2, line 1.
trust that is treated as a separate trust).
Part 2, line 6. Do not enter more than the amount on line 5.
WORKSHEET (Inclusion Ratio) Additional allocations may be made using Part 1.
Part 3, line 3. See the instructions for Part 2, line 3, above.
1. Total estate and gift tax value of all of the property Enter only the total of the GST taxes shown on Schedule(s)
interests that passed to the trust . . . . . . . . . . R-1 that are payable out of the property interests shown on
2. Estate taxes, state death taxes, and other charges Part 3, line 1.
actually recovered from the trust . . . . . . . . . .
3. GST taxes imposed on direct skips to skip persons Part 3, line 6. See the instructions for Part 2, line 6, above.
other than this trust and borne by the property
transferred to this trust . . . . . . . . . . . . . . . . How To Complete Schedule R-1
4. GST taxes actually recovered from this trust (from
Schedule R, Part 2, line 8; or Schedule R-1, Filing due date. Enter the due date of Form 706. You must
line 6) . . . . . . . . . . . . . . . . . . . . . . . . . . send the copies of Schedule R-1 to the fiduciary before this
5. Add lines 2 through 4 . . . . . . . . . . . . . . . . . date.
6. Subtract line 5 from line 1 . . . . . . . . . . . . . . Line 4. Do not enter more than the amount on line 3. If you
7. Add columns C and D of line 9 . . . . . . . . . . . wish to allocate an additional GST exemption, you must use
8. Divide line 7 by line 6 . . . . . . . . . . . . . . . . . Schedule R, Part 1. Making an entry on line 4 constitutes a
9. Trust's inclusion ratio. Subtract line 8 from Notice of Allocation of the decedent's GST exemption to the
1.000 . . . . . . . . . . . . . . . . . . . . . . . . . . trust.
Line 10. Special-use allocation. For skip persons who Line 6. If the property interests entered on line 1 will not bear
receive an interest in section 2032A special-use property, you the GST tax, multiply line 6 by 40% (0.40).
may allocate more GST exemption than the direct skip Signature. The executor(s) must sign Schedule R-1 in the
amount to reduce the additional GST tax that would be due same manner as Form 706. See Signature and Verification,
when the interest is later disposed of or qualified use ceases. earlier.
See Schedule A-1, earlier, for more details about this
Filing Schedule R-1. Attach to Form 706 one copy of each
additional GST tax.
Schedule R-1 that you prepare. Send two copies of each
Enter on line 10 the total additional GST exemption Schedule R-1 to the fiduciary.
available to allocate to all skip persons who received any
interest in section 2032A property. Attach a special-use
allocation statement listing each such skip person and the
amount of the GST exemption allocated to that person.
If you do not allocate the GST exemption, it will
automatically be allocated under the deemed allocation at

Instructions for Form 706 (Rev. 10-2024) 51

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Indirect Ownership of Land
Schedule U—Qualified Conservation
The qualified conservation easement exclusion applies if the
Easement Exclusion land is owned indirectly through a partnership, corporation, or
If at the time of the contribution of the conservation trust, if the decedent owned (directly or indirectly) at least
30% of the entity. For the rules on determining ownership of
! easement, the value of the easement, the value of an entity, see Ownership rules next.
CAUTION the land subject to the easement, or the value of any
retained development right was different from the estate tax Ownership rules. An interest in property owned, directly or
value, you must complete a separate computation in addition indirectly, by or for a corporation, partnership, or trust is
to completing Schedule U. considered proportionately owned by or for the entity's
shareholders, partners, or beneficiaries. A person is the
Use a copy of Schedule U as a worksheet for this separate beneficiary of a trust only if the person has a present interest
computation. Complete lines 4 through 14 of the worksheet in the trust. For additional information, see the ownership
Schedule U. However, the value you use on lines 4, 5, 7, and rules in section 2057(e)(3).
10 of the worksheet is the value for these items as of the date
of the contribution of the easement, not the estate tax value.
If the date of contribution and the estate tax values are the Qualified Conservation Easement
same, you do not need to do a separate computation.
A qualified conservation easement is one that would qualify
After completing the worksheet, enter the amount from as a qualified conservation contribution under section 170(h).
line 14 of the worksheet on line 14 of Schedule U. Finish It must be a contribution:
completing Schedule U by entering amounts on lines 4, 7, • Of a qualified real property interest,
and 15 through 20, following the instructions later for those • To a qualified organization, and
lines. At the top of Schedule U, enter "worksheet attached." • Exclusively for conservation purposes.
Attach the worksheet to the return.
Under section 2031(c), you may elect to exclude a portion Qualified real property interest. A qualified real property
of the value of land that is subject to a qualified conservation interest is any of the following.
easement. You make the election by filing Schedule U with all • The entire interest of the donor, other than a qualified
of the required information and excluding the applicable value mineral interest.
of the land that is subject to the easement on Part • A remainder interest.
5—Recapitulation, on item 12. To elect the exclusion, include • A restriction granted in perpetuity on the use that may be
on Schedule A, B, E, F, G, or H, as appropriate, the made of the real property. The restriction must include a
decedent's interest in the land that is subject to the exclusion. prohibition on more than a de minimis use for commercial
You must make the election on a timely filed Form 706, recreational activity.
including extensions. Qualified organization. A qualified organization includes
The exclusion is the lesser of: the following.
• The applicable percentage of the value of land (after • Corporations and any community chest, fund, or
certain reductions) subject to a qualified conservation foundation, organized and operated exclusively for
easement, or religious, charitable, scientific, testing for public safety,
• $500,000. literary, or educational purposes, or to foster national or
Once made, the election is irrevocable. international amateur sports competition, or for the
prevention of cruelty to children or animals, without net
General Requirements earnings benefitting any individual shareholder and
without activity with the purpose of influencing legislation
Qualified Land or political campaigning, which:
Land may qualify for the exclusion if all of the following a. Receives more than one-third of its support from
requirements are met. gifts, contributions, membership fees, or receipts from
• The decedent or a member of the decedent's family must sales, admissions fees, or performance of services; or
have owned the land for the 3-year period ending on the b. Is controlled by such an organization.
date of the decedent's death. • Any entity that qualifies under section 170(b)(1)(A)(v) or
• No later than the date the election is made, a qualified (vi).
conservation easement on the land has been made by
the decedent, a member of the decedent's family, the Conservation purpose. An easement has a conservation
executor of the decedent's estate, or the trustee of a trust purpose if it is for:
that holds the land. • The preservation of land areas for outdoor recreation by,
• The land is located in the United States or one of its or for the education of, the public;
territories. • The protection of a relatively natural habitat of fish,
wildlife, or plants, or a similar ecosystem; or
• The preservation of open space (including farmland and
Member of Family forest land) where such preservation is for the scenic
enjoyment of the general public, or under a clearly
Members of the decedent's family include the decedent's delineated federal, state, or local conservation policy and
spouse; ancestors; lineal descendants of the decedent, of will yield a significant public benefit.
the decedent's spouse, and of the parents of the decedent;
and the spouse of any lineal descendant. A legally adopted
child of an individual is considered a child of the individual by
blood.

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Specific Instructions 2. A list of all persons in being, holding an interest in the
land that is subject to the qualified conservation
Line 1 easement. Include each person's name, address, TIN,
relationship to the decedent, and a description of their
If the land is reported as one or more item numbers on a interest.
Form 706 schedule, simply list the schedule and item
numbers. If the land subject to the easement is only part of 3. The items of real property shown on the estate tax return
an item, however, list the schedule and item number and that are subject to the qualified conservation easement
describe the part subject to the easement. See the (identified by schedule and item number).
instructions for Schedule A—Real Estate, earlier, for 4. A description of the retained development right that is to
information on how to describe the land. be extinguished.
Line 3 5. A clear statement of consent that is binding on all parties
under applicable local law:
Using the general rules for describing real estate, provide a. To take whatever action is necessary to permanently
enough information so the IRS can value the easement. Give extinguish the retained development rights listed in
the date the easement was granted and by whom it was the agreement; and
granted.
b. To be personally liable for additional taxes under
section 2031(c)(5)(C) if this agreement is not
Line 4 implemented by the earlier of:
Enter on this line the gross value at which the land was • The date that is 2 years after the date of the
reported on the applicable asset schedule on this Form 706. decedent's death, or
Do not reduce the value by the amount of any mortgage • The date of sale of the land subject to the
outstanding. Report the estate tax value even if the easement qualified conservation easement.
was granted by the decedent (or someone other than the 6. A statement that in the event this agreement is not timely
decedent) prior to the decedent's death. implemented, that they will report the additional tax on
Note. If the value of the land reported on line 4 was different whatever return is required by the IRS and will file the
at the time the easement was contributed from that reported return and pay the additional tax by the last day of the
on Form 706, see the Caution at the beginning of the sixth month following the applicable date described
Schedule U instructions. above.
All parties to the agreement must sign the agreement.
Line 5
For an example of an agreement containing some of the
The amount on line 5 should be the date of death value of same terms, see Part 3 of Schedule A-1.
any qualifying conservation easements granted prior to the
decedent's death, whether granted by the decedent or Line 10
someone other than the decedent, for which the exclusion is
being elected. Enter the total value of the qualified conservation easements
Note. If the value of the easement reported on line 5 was on which the exclusion is based. This could include
different at the time the easement was contributed than at the easements granted by the decedent (or someone other than
date of death, see the Caution at the beginning of the the decedent) prior to the decedent's death, easements
Schedule U instructions. granted by the decedent that take effect at death, easements
granted by the executor after the decedent's death, or some
combination of these.
Line 7
Use the value of the easement as of the date of
You must reduce the land value by the value of any ! death, even if the easement was granted prior to the
development rights retained by the donor in the conveyance CAUTION date of death. But, if the value of the easement was
of the easement. A development right is any right to use the different at the time the easement was contributed than at the
land for any commercial purpose that is not subordinate to or date of death, see the Caution at the beginning of the
directly supportive of the use of the land as a farm for farming Schedule U instructions.
purposes.
Note. If the value of the retained development rights Explain how this value was determined and attach copies
reported on line 7 was different at the time the easement was of any appraisals. Normally, the appropriate way to value a
contributed than at the date of death, see the Caution at the conservation easement is to determine the FMV of the land
beginning of the Schedule U instructions. both before and after the granting of the easement, with the
difference being the value of the easement.
You do not have to make this reduction if everyone with an
Reduce the reported value of the easement by the amount
interest in the land (regardless of whether in possession)
agrees to permanently extinguish the retained development of any consideration received for the easement. If the date of
death value of the easement is different from the value at the
right. The agreement must be filed with this return and must
include all of the following information and terms. time the consideration was received, reduce the value of the
easement by the same proportion that the consideration
1. A statement that the agreement is made under section received bears to the value of the easement at the time it was
2031(c)(5). granted.

Instructions for Form 706 (Rev. 10-2024) 53

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 For example, assume the value of the easement at the                 examination of Form 706, nor will it delay the issuance of a 
time it was granted was $100,000 and $10,000 was received             closing letter for the estate.
in consideration for the easement. If the easement was worth 
$150,000 at the date of death, you must reduce the value of           Initial Notice of Claim
the easement by $15,000 ($10,000/$100,000 × $150,000)                 The first Schedule PC to be filed is the initial notice of 
and report the value of the easement on line 10 as $135,000.          protective claim for refund. The estate will receive a written 
                                                                      acknowledgment of receipt of the claim from the IRS. If the 
Line 15                                                               acknowledgment is not received within 180 days of filing the 
                                                                      protective claim for refund on Schedule PC, the fiduciary 
If a charitable contribution deduction for this land has been         should contact the IRS at 866-699-4083 to inquire about the 
taken on Schedule O, enter the amount of the deduction                receipt and processing of the claim. A certified mail receipt or 
here. If the easement was granted after the decedent's death,         other evidence of delivery is not sufficient to confirm receipt 
a contribution deduction may be taken on Schedule O, if it            and processing of the protective claim for refund.
otherwise qualifies, as long as no income tax deduction was 
or will be claimed for the contribution by any person or entity.      Note. The written acknowledgment of receipt does not 
                                                                      constitute a determination that all requirements for a valid 
                                                                      protective claim for refund have been met.
Line 16
                                                                      In general, the claim will not be subject to substantive 
Reduce the value of the land by the amount of any acquisition         review until the amount of the claim has been established. 
indebtedness on the land at the date of the decedent's death.         However, a claim can be disallowed at the time of filing. For 
Acquisition indebtedness includes the unpaid amount of:               example, the claim for refund will be rejected if:
•  Any indebtedness incurred by the donor in acquiring the            • The claim was not timely filed,
   property;                                                          • The claim was not filed by the fiduciary or other person 
•  Any indebtedness incurred before the acquisition if the              with authority to act on behalf of the estate,
   indebtedness would not have been incurred but for the              • The acknowledgment of the penalties of perjury 
   acquisition;                                                         statement (on page 1 of Form 706) was not signed, or
•  Any indebtedness incurred after the acquisition if the             • The claim is not adequately described.
   indebtedness would not have been incurred but for the 
   acquisition and the incurrence of the indebtedness was             If the IRS does not raise such a defect when the claim is 
   reasonably foreseeable at the time of the acquisition; and         filed, it will not be precluded from doing so in the later 
•  The extension, renewal, or refinancing of acquisition              substantive review.
   indebtedness.                                                      The estate may be given an opportunity to cure any 
                                                                      defects in the initial notice by filing a corrected and signed 
Schedule PC—Protective Claim for                                      protective claim for refund before the expiration of the 
                                                                      limitations period in section 6511(a) or within 45 days of 
Refund                                                                notice of the defect, whichever is later.
A protective claim for refund preserves the estate’s right to a 
refund of tax paid on any amount included in the gross estate         Related Ancillary Expenses
which would be deductible under section 2053 but has not              If a section 2053 protective claim for refund has been 
been paid or otherwise will not meet the requirements of              adequately identified on Schedule PC, the IRS will presume 
section 2053 until after the limitations period for filing the        that the claim includes certain expenses related to resolving, 
claim has passed. See section 6511(a).                                defending, or satisfying the claim. These ancillary expenses 
        Only use Schedule PC for section 2053 protective              may include attorneys’ fees, court costs, appraisal fees, and 
                                                                      accounting fees. The estate is not required to separately 
CAUTION initial notice of the protective claim for refund is being 
 !      claims for refund being filed with Form 706. If the           identify or substantiate these expenses; however, each 
submitted after Form 706 has been filed, use Form 843,                expense must meet the requirements of section 2053 to be 
Claim for Refund and Request for Abatement, to file the               deductible.
claim.
                                                                      Notice of Final Resolution of Claim
 Schedule PC may be used to file a section 2053 protective            When an expense that was the subject of a section 2053 
claim for refund by estates of decedents who died after               protective claim for refund is finally determined, the estate 
December 31, 2011. It will also be used to inform the IRS             must notify the IRS that the claim for refund is ready for 
when the contingency leading to the protective claim for              consideration. The notification should provide facts and 
refund is resolved and the refund due the estate is finalized.        evidence substantiating the deduction under section 2053 
The estate must indicate whether the Schedule PC being                and the resulting recomputation of the estate tax liability. A 
filed is the initial notice of protective claim for refund, notice of separate notice of final resolution must be filed with the IRS 
partial claim for refund, or notice of the final resolution of the    for each resolved section 2053 protective claim for refund.
claim for refund.
                                                                      There are two means by which the estate may notify the 
 Because each separate claim or expense requires a                    IRS of the resolution of the uncertainty that deprived the 
separate Schedule PC, more than one Schedule PC may be                estate of the deduction when Form 706 was filed. The estate 
included with Form 706, if applicable. Two copies of each             may file a supplemental Form 706 with an updated 
Schedule PC must be included with Form 706.                           Schedule PC and include each schedule affected by the 
                                                                      allowance of the deduction under section 2053. Page 1 of 
Note. Filing a section 2053 protective claim for refund on            Form 706 should contain the notation “Supplemental 
Schedule PC will not suspend the IRS’s review and                     Information—Notification of Consideration of Section 2053 

54                                                                                       Instructions for Form 706 (Rev. 10-2024)

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Protective Claim(s) for Refund” and include the filing date of counterclaims in related matters (Regulations section
the initial notice of protective claim for refund. A copy of the 20.2053-4(b)), or claims under $500,000 (Regulations
initial notice of claim should also be submitted. section 20.2053-4(c)). Provide all relevant information as
Alternatively, the estate may notify the IRS by filing an described, including, most importantly, an explanation of the
updated Form 843. Form 843 must contain the notation reasons and contingencies delaying the actual payment to be
“Notification of Consideration of Section 2053 Protective made in satisfaction of the claim or expense. Complete
Claim(s) for Refund,” including the filing date of the initial columns E and F only if filing a notice of partial or final
notice of protective claim for refund, on page 1. A copy of the resolution. Show the amount of ancillary or related expenses
initial notice of claim must also be submitted. to be included in the claim for refund and indicate whether
this amount is estimated, agreed upon, or has been paid.
The estate should notify the IRS of resolution within 90 Also show the amount being claimed for refund.
days of the date the claim or expense is paid or the date on
which the amount of the claim becomes certain and no Note. If you made partial claims for a recurring expense, the
longer subject to contingency, whichever is later. Separate amount presently claimed as a deduction under section 2053
notifications must be submitted for every section 2053 will only include the amount presently claimed, not the
protective claim for refund that was filed. cumulative amount.
If the final section 2053 claim or expense involves multiple
or recurring payments, the 90-day period begins on the date Part 3. Other Schedules PC and Forms 843 Filed
of the last payment. The estate may also notify the IRS (not by the Estate
more than annually) as payments are being made and
possibly qualify for a partial refund based on the amounts On the chart in Part 3, provide information on other protective
paid through the date of the notice. claims for refund that have been previously filed on behalf of
the estate (if any), whether on other Schedules PC or on
Specific Instructions Form 843. When the initial claim for refund is filed, only
Part 1. General Information information from Form(s) 843 need be included in Part 3.
However, when filing a partial or final claim for refund,
Complete Part 1 by providing information that is correct and complete Part 3 by including the status of all claims filed by or
complete as of the time Schedule PC is filed. If filing an on behalf of the estate, including those filed on other
updated Schedule PC with a supplemental Form 706 or as Schedules PC with Form 706. For each such claim, give the
notice of final resolution of the protective claim for refund, be place of filing, date of filing, and amount of the claim.
sure to update the information from the original filing to
ensure that it is accurate. Be particularly careful to verify that
contact information (addresses and telephone numbers) and Continuation Schedule
the reason for filing Schedule PC are indicated correctly. If When you need to list more assets or deductions than you
the fiduciary is different from the executor identified on have room for on one of the main schedules, use the
page 1 of Form 706 or has changed since the initial notice of Continuation Schedule at the end of Form 706. It provides a
protective claim for refund was filed, attach letters uniform format for listing additional assets from Schedules A
testamentary, letters of administration, or similar through I and additional deductions from Schedules J, K, L,
documentation evidencing the fiduciary's authority to file the M, and O.
protective claim for refund on behalf of the estate. Include a
copy of Form 56, Notice Concerning Fiduciary Relationship, if Please remember to do the following.
it has been filed. • Use a separate Continuation Schedule for each main
schedule you are continuing. Do not combine assets or
deductions from different schedules on one Continuation
Part 2. Claim Information
Schedule.
For a protective claim for refund to be properly filed and • Make copies of the blank schedule before completing it if
considered, the claim or expense forming the basis of the you expect to need more than one.
potential section 2053 deduction must be clearly identified. • Use as many Continuation Schedules as needed to list
Using the check boxes provided, indicate whether you are all the assets or deductions.
filing the initial claim for refund, a claim for partial refund, or a • Enter the letter of the schedule you are continuing in the
final claim. space at the top of the Continuation Schedule.
• Use the Unit value column only if continuing Schedule B,
On the chart in Part 2, give the Form 706 schedule and E, or G. For all other schedules, use this space to
item number of the claim or expense. List any amounts continue the description.
claimed under exceptions for ascertainable amounts • Carry the total from the Continuation Schedules forward
(Regulations section 20.2053-1(d)(4)), claims and to the appropriate line on the main schedule.

If continuing Report Where on Continuation Schedule
Schedule E, Pt. 2 Percentage includible Alternate valuation date
Schedules J, L, M Continued description of deduction Alternate valuation date and Alternate value
Schedule O Character of institution Alternate valuation date and Alternate value
Schedule O Amount of each deduction Value at date of death or amount deductible

Instructions for Schedules 55

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Privacy Act and 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. Subtitle B and section 6109, and the regulations require you to
provide this information.
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. However, section 6103 allows or requires the Internal Revenue Service
to disclose information from this form in certain circumstances. For example, we may disclose information to the Department of
Justice for civil or criminal litigation, and to cities, states, the District of Columbia, and U.S. commonwealths or territories for use
in administering their tax laws. We may also disclose this information to other countries under a tax treaty, to federal and state
agencies to enforce federal nontax criminal laws, or to federal law enforcement and intelligence agencies to combat terrorism.
Failure to provide this information, or providing false information, may subject you to penalties.
The time needed to complete and file this form and related schedules will vary depending on individual circumstances. The
estimated average times are:
Form Recordkeeping Learning about the law Preparing the form Copying, assembling, and sending
or the form the form to the IRS
Form 706 & embedded 6 hr., 46 min. 7 hr., 39 min. 13 hr., 8 min. 9 hr., 10 min.
schedules
Form Schedule R-1 (706) 6 min. 29 min. 24 min. 20 min.

If you have comments concerning the accuracy of these time estimates or suggestions for making Form 706 simpler, we
would be happy to hear from you. You can send us comments through IRS.gov/FormComments. Or you can write to:
Internal Revenue Service
Tax Forms and Publications Division
1111 Constitution Ave. NW, IR-6526
Washington, DC 20224

Do not send the tax form to this address. Instead, see Where To File, earlier.

56 Instructions for Form 706 (Rev. 10-2024)

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Index
 
                                       Line 3 Worksheet  15                       Schedule M, Bequests to Surviving 
A                                      Line 4 Worksheet  8                         Spouses   38
Address, executor   6                  Line 7 Worksheet  9                        Schedule O, Charitable, Public, and 
Administration Expenses    35          Losses 37                                   Similar Gifts and Bequests            41
Alternate valuation 10                 Lump-sum distribution election   34        Schedule P, Credit for Foreign Death 
                                                                                   Taxes   42
Amending Form 706     3                                                           Schedule PC, Protective Claim for 
Annuities 32                           M                                           Refund  54
Applicable Credit Adjustment   10      Marital Deduction 38                       Schedule Q, Credit for Tax on Prior 
Applicable Credit Amount   9           Material participation 12                   Transfers    44
Authorized Representative    16        Member of family  12                       Schedule U, Qualified Conservation 
                                       Mortgages and liens  37                     Easement Exclusion     52
                                                                                  Schedules R and R-1, Generation-Skipping 
B                                                                                  Transfer Tax   47
Bonds 24                               N                                          Section 2032A  11
                                       Nonresident Noncitizens   2                Section 2035(a) transfers  30
C                                                                                 Section 2036 transfers 30
Canadian marital credit   10           P                                          Section 2037 transfers 31
                                                                                  Section 2038 transfers 31
Charitable Deduction   41              Part 1. Decedent and Executor  5           Section 2044  17
Claim for refund  54                   Part 2. Tax Computation  6                 Section 6163  16
Close Corporations   17                Part 3. Elections by the Executor 10       Section 6166  14
Closing letters 4                      Part 4. General Information 16             Signature and verification 3
Conservation Easement     52           Part 5. Recapitulation 17                  Social security number  5 6, 
Continuation Schedule     55           Part 6. Portability of Deceased Spousal    Special Rule – Portability 20
Credit for foreign death taxes 42        Unused Exclusion     18
Credit for tax on prior transfers 44   Partnership Interests  17                  Special-Use Valuation  11 22, 
                                       Paying the Tax 2                           Specific Instructions 5
D                                      Penalties 4                                Stocks 24
                                       Portability 18
Death certificate 3                    Powers of appointment   32                 T
Debts of the decedent  36              Protective Claim for Refund 54             Table A, Unified Rate Schedule         6
Deductions   18                        Publications, obtaining 5                  Table of Basic Exclusion Amounts         8
Direct skips 47                        Purpose of Form   1                        Table of Estimated Values  19 20, 
Disclaimer, qualified 42                                                          Table, Taxable Gift Amount   7
Documents, supplemental      3         Q                                          Tax Computation   6
DSUE  18                                                                          Taxable Gift Amount Table   7
                                       QDOT 40
E                                      QTIP 40                                    Terminable Interests  38
                                       Qualified heir 12                          Total Credits 10
Election 14 16,                        Qualified real property 12                 Transfers, valuation rules 31
Election, lump-sum distribution   34                                              Trusts 17
Estate tax closing letters 4           R
Estimated Values  20                                                              U
Exclusion amount    7                  Recapitulation 17
Executor 2 6,                          Residents of U. S. Territories 2           U. S. Citizens or Residents 2
                                       Reversionary or Remainder Interests  16    Unified Credit (Applicable Credit 
                                                                                   Amount)   9
F                                      Revisions of Form 706   1                  Unified credit adjustment  10
                                       Rounding off to whole dollars  4
Foreign Accounts    17
Foreign Death Taxes   42               S                                          V
Forms and publications, obtaining    5                                            Valuation methods  13
Funeral Expenses    35                 Schedule A-1, Section 2032A Valuation   22 Valuation rules, transfers 31
                                       Schedule A, Real Estate  21
G                                      Schedule B, Stocks and Bonds     24
                                       Schedule C, Mortgages, Notes, and          W
General Information   16                 Cash  26                                 What's New 1
General Instructions  1                Schedule D, Insurance on Decedent's        When To File  2
Gross estate  1 17,                      Life 27                                  Where To File 2
GST 47                                 Schedule E, Jointly Owned Property   28    Which Estates Must File 1
GST exemption table   50               Schedule F, Miscellaneous Property   28    Worksheet for Schedule Q    46
                                       Schedule G, Transfers During Decedent's    Worksheet TG-Taxable Gifts 
I                                        Life 30                                   Reconciliation   8
                                       Schedule H, Powers of appointment    32    Worksheet, inclusion ratio for trust     51
Inclusion ratio for trust 51           Schedule I, Annuities  32                  Worksheet, line 3 15
Installment payments   14              Schedule J, Funeral Expenses and           Worksheet, line 4 8
Insurance 27                             Expenses Incurred in Administering       Worksheet, line 7 9
                                         Property Subject to Claims   35
J                                      Schedule K, Debts of the Decedent and 
                                         Mortgages and Liens    36
Joint Property  28                     Schedule L, Net Losses During 
                                         Administration and Expenses Incurred 
L                                        in Administering Property Not Subject 
Liens 37                                 to Claims 37

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Checklists for Completing Form 706

To ensure a complete return, review the following checklists before filing Form 706.

Attachments . . .

Death Certificate.

Certified copy of the will—if decedent died testate, you must attach a certified copy of the will. If not certified, explain why.

Appraisals—attach any appraisals used to value property included on the return.

Copies of all trust documents where the decedent was a grantor or a beneficiary.

Form 2848 or 8821, if applicable.

Copy of any Form(s) 709 filed by the decedent, with "Exhibit to Estate Tax Return" entered across the top of the first page(s).

Copy of Line 7 Worksheet, if applicable, with “Exhibit to Estate Tax Return” entered across the top of the page(s).

Form 712, if any policies of life insurance are included on the return.

Form 706-CE, if claiming a foreign death tax credit.

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Have you . . .

Signed the return at the bottom of page 1?

Had the preparer sign, if applicable?

Obtained the signature of your authorized representative on Part 4—General Information, page 2?

Entered a Total on all schedules filed?

Made an entry on every line of the Recapitulation, even if it is a zero?

Included the CUSIP number for all stocks and bonds?

Included the EIN of trusts, partnerships, and closely held entities?

Included the first 4 pages of the return and all required schedules?

Completed Schedule F? It must be filed with all returns.

Completed Part 4—General Information, line 4, on page 2, if there is a surviving spouse?

Completed and attached Schedule D to report insurance on the life of the decedent, even if its value is not included in the 
estate?

Included any QTIP property received from a predeceased spouse?

Entered the decedent's name, SSN, and “Form 706” on your check or money order?

Completed Part 6, Section A, if the estate elects not to transfer any DSUE amount to the surviving spouse?

Completed Part 6, Section C, if the estate elects portability of any DSUE amount?

Completed Part 6, Section D, and included a copy of the Form 706, with “Exhibit to Estate Tax Return” entered across the 
top of the first page, of any predeceased spouse(s) from whom a DSUE amount was received and applied?

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