United States Estate (and Generation-Skipping

Transfer) Tax Return

Form 706

OMB No. 1545-0015 (Rev. August 2008)

Department of the Treasury Estate of a citizen or resident of the United States (see separate instructions).

Internal Revenue Service

1a Decedent’s first name and middle initial (and maiden name, if any) 1b Decedent’s Social Security No. Decedent’s last name 2

3a County, state, and ZIP code, or foreign country, of legal 3b Year domicile established 4 Date of birth Date of death 5

residence (domicile) at time of death

6a Name of executor (see page 4 of the instructions)

Executor’s address (number and street including apartment or suite no.; city, town,

or post office; state; and ZIP code) and phone no.

6b

6c Executor’s social security number (see page 5 of the instructions)

7a Name and location of court where will was probated or estate administered 7b Case number

8 If decedent died testate, check here and attach a certified copy of the will. 9 If you extended the time to file this Form 706, check here 

Part 1—Decedent and Executor

10 If Schedule R-1 is attached, check here 

1 Total gross estate less exclusion (from Part 5—Recapitulation, page 3, item 12) 1

2 Tentative total allowable deductions (from Part 5—Recapitulation, page 3, item 22) 2

3a Tentative taxable estate (before state death tax deduction) (subtract line 2 from line 1) 3a

4 Adjusted taxable gifts (total taxable gifts (within the meaning of section 2503) made by the decedent

after December 31, 1976, other than gifts that are includible in decedent’s gross estate (section 2001(b))) 4

5 Add lines 3c and 4 5

6 Tentative tax on the amount on line 5 from Table A on page 4 of the instructions 6

Total gift tax paid or payable with respect to gifts made by the decedent after December 31, 1976.

Include gift taxes by the decedent’s spouse for such spouse’s share of split gifts (section 2513) only if

the decedent was the donor of these gifts and they are includible in the decedent’s gross estate (see

instructions)

7

7

8 Gross estate tax (subtract line 7 from line 6) 8

9 Maximum unified credit (applicable credit amount) against estate tax 9

Adjustment to unified credit (applicable credit amount). (This adjustment

may not exceed $6,000. See page 6 of the instructions.)

10

10

Part 2—Tax Computation

11 Allowable unified credit (applicable credit amount) (subtract line 10 from line 9) 11

12 Subtract line 11 from line 8 (but do not enter less than zero) 12

15 15

16

Credit for tax on prior transfers (from Schedule Q)

17

18

Total credits (add lines 13 and 14)

19

Net estate tax (subtract line 15 from line 12)

20

Generation-skipping transfer (GST) taxes payable (from Schedule R, Part 2, line 10)

Total transfer taxes (add lines 16 and 17)

Prior payments. Explain in an attached statement

Balance due (or overpayment) (subtract line 19 from line 18)

Under penalties of perjury, I declare that I have examined this return, including accompanying schedules and statements, and to the best of my

knowledge and belief, it is true, correct, and complete. Declaration of preparer other than the executor is based on all information of which preparer

has any knowledge.

Cat. No. 20548R

To be filed for decedents dying after December 31, 2007, and before January 1, 2009.

Phone no. ( )

b

c

State death tax deduction

Taxable estate (subtract line 3b from line 3a)

3b

3c

Credit for foreign death taxes (from Schedule(s) P). (Attach Form(s)

706-CE.)

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13

14

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20

For Privacy Act and Paperwork Reduction Act Notice, see page 30 of the separate instructions for this form. Form 706 (Rev. 8-2008)

Sign

Here Date

Preparer’s

signature

Check if

self-employed 

Preparer’s SSN or PTIN

Firm’s name (or

yours if self-employed),

address, and ZIP code

EIN 

Phone no. ( )









Date

Paid

Preparer’s

Use Only

Date

Signature of executor

Signature of executor
I declare that I am the attorney/ certified public accountant/ enrolled agent (you must check the applicable box) for the executor and prepared

this return for the executor. I am not under suspension or disbarment from practice before the Internal Revenue Service and am qualified to practice in the

state shown above.

Form 706 (Rev. 8-2008)

Estate of:

Part 3—Elections by the Executor

Please check the “Yes” or “No” box for each question (see instructions beginning on page 6). Yes No

1 Do you elect alternate valuation?

2 Do you elect special-use valuation?

If “Yes,” you must complete and attach Schedule A-1.

3 Do you elect to pay the taxes in installments as described in section 6166?

If “Yes,” you must attach the additional information described on pages 10 and 11 of the instructions.

Do you elect to postpone the part of the taxes attributable to a reversionary or remainder interest as described in

section 6163?

4

Part 4—General Information

Authorization to receive confidential tax information under Regs. sec. 601.504(b)(2)(i); to act as the estate’s representative before the IRS; and to make written

or oral presentations on behalf of the estate if return prepared by an attorney, accountant, or enrolled agent for the executor:

Name of representative (print or type) State Address (number, street, and room or suite no., city, state, and ZIP code)

Signature CAF number Date Telephone number

1 Death certificate number and issuing authority (attach a copy of the death certificate to this return).

2 Decedent’s business or occupation. If retired, check here and state decedent’s former business or occupation.

3 Marital status of the decedent at time of death:

Married

Widow or widower—Name, SSN, and date of death of deceased spouse 

Single

Legally separated

Divorced—Date divorce decree became final 

4a Surviving spouse’s name 4b Social security number 4c Amount received (see page 12 of the instructions)

Individuals (other than the surviving spouse), trusts, or other estates who receive benefits from the estate (do not include charitable beneficiaries

shown in Schedule O) (see instructions).

5

Name of individual, trust, or estate receiving $5,000 or more Identifying number Relationship to decedent Amount (see instructions)

All unascertainable beneficiaries and those who receive less than $5,000 

Total

(continued on next page) Page 2

(Note. Please attach the necessary supplemental documents. You must attach the death certificate.)

(see instructions on page 12)

Please check the “Yes” or “No” box for each question. Yes No

Does the gross estate contain any section 2044 property (qualified terminable interest property (QTIP) from a prior gift or estate)

(see page 12 of the instructions)?

6

1

2

3

4

7a Have federal gift tax returns ever been filed?

If “Yes,” please attach copies of the returns, if available, and furnish the following information:

7b Period(s) covered 7c Internal Revenue office(s) where filed

Note. Some of these elections may require the posting of bonds or liens.

Note. By electing section 6166, you may be required to provide security for estate tax deferred under

section 6166 and interest in the form of a surety bond or a section 6324A lien.

8a Was there any insurance on the decedent’s life that is not included on the return as part of the gross estate?

b Did the decedent own any insurance on the life of another that is not included in the gross estate?

Decedent’s Social Security Number
Form 706 (Rev. 8-2008)

If you answer “Yes” to any of questions 9–16, you must attach additional information as described in the instructions. Yes No

Did the decedent at the time of death own any property as a joint tenant with right of survivorship in which (a) one or more of

the other joint tenants was someone other than the decedent’s spouse, and (b) less than the full value of the property is included

on the return as part of the gross estate? If “Yes,” you must complete and attach Schedule E

9

Did the decedent, at the time of death, own any interest in a partnership (for example, a family limited partnership), an unincorporated

business, or a limited liability company; or own any stock in an inactive or closely held corporation?

10a

11 Did the decedent make any transfer described in section 2035, 2036, 2037, or 2038 (see the instructions for Schedule G beginning

on page 15 of the separate instructions)? If “Yes,” you must complete and attach Schedule G

12a Were there in existence at the time of the decedent’s death any trusts created by the decedent during his or her lifetime?

Were there in existence at the time of the decedent’s death any trusts not created by the decedent under which the decedent

possessed any power, beneficial interest, or trusteeship?

b

c Was the decedent receiving income from a trust created after October 22, 1986 by a parent or grandparent?

13 Did the decedent ever possess, exercise, or release any general power of appointment? If “Yes,” you must complete and attach Schedule H

14 Did the decedent have an interest in or a signature or other authority over a financial account in a foreign country, such as a

bank account, securities account, or other financial account?

Was the decedent, immediately before death, receiving an annuity described in the “General” paragraph of the instructions for

Schedule I or a private annuity? If “Yes,” you must complete and attach Schedule I

15

Part 5—Recapitulation

Item

number Gross estate Alternate value Value at date of death

1 Schedule A—Real Estate

2 Schedule B—Stocks and Bonds

3 Schedule C—Mortgages, Notes, and Cash

4 Schedule D—Insurance on the Decedent’s Life (attach Form(s) 712)

5 Schedule E—Jointly Owned Property (attach Form(s) 712 for life insurance)

6 Schedule F—Other Miscellaneous Property (attach Form(s) 712 for life insurance)

7 Schedule G—Transfers During Decedent’s Life (att. Form(s) 712 for life insurance)

8 Schedule H—Powers of Appointment

9 Schedule I—Annuities

10 Total gross estate (add items 1 through 9)

Item

number Deductions Amount

11

Schedule K—Debts of the Decedent

12

Schedule K—Mortgages and Liens

13

Total of items 13 through 15

14

Allowable amount of deductions from item 16 (see the instructions for item 17 of the Recapitulation)

15

Schedule L—Net Losses During Administration

16

Schedule L—Expenses Incurred in Administering Property Not Subject to Claims

17

Schedule M—Bequests, etc., to Surviving Spouse

18

Schedule O—Charitable, Public, and Similar Gifts and Bequests

19

20

Tentative total allowable deductions (add items 17 through 21). Enter here and on line 2 of the Tax Computation

Page 3

Schedule U—Qualified Conservation Easement Exclusion

Total gross estate less exclusion (subtract item 11 from item 10). Enter here

and on line 1 of Part 2—Tax Computation

21

22

Schedule J—Funeral Expenses and Expenses Incurred in Administering Property Subject to Claims

Was the decedent ever the beneficiary of a trust for which a deduction was claimed by the estate of a pre-deceased spouse

under section 2056(b)(7) and which is not reported on this return? If “Yes,” attach an explanation

16

Part 4—General Information (continued)

1

2

3

4

5

6

7

8

9

10

11

12

13

14

15

16

17

18

19

20

21

22

If there was a GST taxable termination (under section 2612), attach a statement to explain. Provide a copy of the trust or will

creating the trust, and give the name, address, and phone number of the current trustee(s).

If “Yes,” was there a GST taxable termination (under section 2612) upon the death of the decedent?

d

Did the decedent at any time during his or her lifetime transfer or sell an interest in a partnership, limited liability company, or

closely held corporation to a trust described in question 12a or 12b?

e

If “Yes,” provide the EIN number to this transferred/sold item. 

If “Yes,” was the value of any interest owned (from above) discounted on this estate tax return? If “Yes,” see the instructions for

Schedule F on page 20 for reporting the total accumulated or effective discounts taken on Schedule F or G

b
Form 706 (Rev. 8-2008)

SCHEDULE A—Real Estate ● For jointly owned property that must be disclosed on Schedule E, see the instructions on the reverse side of Schedule E.

● Real estate that is part of a sole proprietorship should be shown on Schedule F.

● If you elect section 2032A valuation, you must complete Schedule A and Schedule A-1.

Alternate

valuation date

Item

number Description Alternate value Value at date of death

1

Total from continuation schedules or additional sheets attached to this schedule

TOTAL. (Also enter on Part 5—Recapitulation, page 3, at item 1.)

(If more space is needed, attach the continuation schedule from the end of this package or additional sheets of the same size.)

Schedule A—Page 4

(See the instructions on the reverse side.)

● Real estate that is included in the gross estate under section 2035, 2036, 2037, or 2038 should be shown on

Schedule G.

● Real estate that is included in the gross estate under section 2041 should be shown on Schedule H.

Decedent’s Social Security Number

Estate of:
Form 706 (Rev. 8-2008)

In this example, alternate valuation is not adopted; the date of death is January 1, 2008.

Value at 

date of death

Alternate

valuation date

Item

number

Alternate

value Description

House and lot, 1921 William Street NW, Washington, DC (lot 6, square 481). Rent

of $8,100 due at end of each quarter, February 1, May 1, August 1, and November

1. Value based on appraisal, copy of which is attached

1

$550,000

Rent due on item 1 for quarter ending November 1, 2007, but not collected at date

of death 8,100

Rent accrued on item 1 for November and December 2007 5,400

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

2

375,000

Rent due on item 2 for December 2007, but not collected at date of death 1,800

In this example, alternate valuation is adopted; the date of death is January 1, 2008.

Value at 

date of death

Alternate

valuation date

Item

number

Alternate

value Description

House and lot, 1921 William Street NW, Washington, DC (lot 6, square 481). Rent

of $8,100 due at 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 following death

1

7/1/08 $535,000 $550,000

Rent due on item 1 for quarter ending November 1, 2007, but not collected until

February 1, 2008 2/1/08 8,100 8,100

Rent accrued on item 1 for November and December 2007, collected on

February 1, 2008 2/1/08 5,400 5,400

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, 2008

2

5/1/08 369,000 375,000

Rent due on item 2 for December 2007, but not collected until February 1, 2008 1,800 2/1/08 1,800

Schedule A—Page 5

Instructions for Schedule A—Real Estate

If the total gross estate contains any real estate, you must

complete Schedule A and file it with the return. On

Schedule A, list real estate the decedent owned or had

contracted to purchase. Number each parcel in the

left-hand column.

Describe the real estate in enough detail so that the IRS

can easily locate it for inspection and valuation. For each

parcel of real estate, report the area and, if the parcel is

improved, describe the improvements. For city or town

property, report the street and number, ward, subdivision,

block and lot, etc. For rural property, report the township,

range, landmarks, etc.

Also list on Schedule A real property the decedent

contracted to purchase. Report the full value of the

property and not the equity in the value column. Deduct

the unpaid part of the purchase price on Schedule K.

Report the value of real estate without reducing it for

homestead or other exemption, or the value of dower,

curtesy, or a statutory estate created instead of dower or

curtesy.

If any item of real estate is subject to a mortgage for

which the decedent’s estate is liable; that is, if the

indebtedness may be charged against other property of

the estate that is not subject to that mortgage, or if the

decedent was personally liable for that mortgage, you

must report the full value of the property in the value

Explain how the reported values were determined and

attach copies of any appraisals.

Schedule A Examples

If the decedent’s estate is not liable for the amount of

the mortgage, report only the value of the equity of

redemption (or value of the property less the

indebtedness) in the value column as part of the gross

estate. Do not enter any amount less than zero. Do not

deduct the amount of indebtedness on Schedule K.

column. Enter the amount of the mortgage under

“Description” on this schedule. The unpaid amount of the

mortgage may be deducted on Schedule K.
Form 706 (Rev. 8-2008)

If the skip person received interests in specially valued

property that were shown on Schedule R-1, show these interests

on the Schedule R, Parts 2 and 3 worksheets, as appropriate.

Do not use Schedule R-1 as a worksheet.

Instructions for Schedule A-1. Section

2032A Valuation

The election to value certain farm and closely held business

property at its special-use value is made by checking “Yes” to

Form 706, Part 3—Elections by the Executor, line 2. Schedule

A-1 is used to report the additional information that must be

submitted to support this election. In order to make a valid

election, you must complete Schedule A-1 and attach all of the

required statements and appraisals.

Completing the special-use value worksheets. On

Schedule R, Parts 2 and 3, lines 2 through 4 and 6, enter -0-.

For definitions and additional information concerning Completing the fair market value worksheets.

special-use valuation, see section 2032A and the related

regulations.

● Schedule R, Parts 2 and 3, line 6—GST exemption allocation.

If you completed Schedule R, Part 1, line 10, enter on line 6 the

amount shown for the skip person on the line 10 special-use

allocation schedule you attached to Schedule R. If you did not

complete Schedule R, Part 1, line 10, enter -0- on line 6.

Part 1. Type of Election

Estate and GST tax elections. If you elect special-use valuation

for the estate tax, you must also elect special-use valuation for

the GST tax and vice versa.

You must value each specific property interest at the same

value for GST tax purposes that you value it at for estate tax

purposes.

Total GST tax savings. For each skip person, subtract the tax

amount on line 10, Part 2 of the special-use value worksheet

from the tax amount on line 10, Part 2 of the fair market value

worksheet. This difference is the skip person’s total GST tax

savings.

Protective election. To make the protective election described

in the separate instructions for Part 3—Elections by the

Executor, line 2, you must check this box, enter the decedent’s

name and social security number in the spaces provided at the

top of Schedule A-1, and complete Part 2. Notice of Election,

line 1 and lines 3 and 4, column A. For purposes of the

protective election, list on line 3 all of the real property that

passes to the qualified heirs even though some of the property

will be shown on line 2 when the additional notice of election is

subsequently filed. You need not complete columns B through D

of lines 3 and 4. You need not complete any other line entries on

Schedule A-1. Completing Schedule A-1 as described above

constitutes a Notice of Protective Election as described in

Regulations section 20.2032A-8(b).

Part 3. Agreement to Special Valuation Under

Section 2032A

The agreement to special valuation by persons with an interest in

property is required under section 2032A(a)(1)(B) and (d)(2) and

must be signed by all parties who have any interest in the

property being valued based on its qualified use as of the date

of the decedent’s death.

An interest in property is an interest that, as of the date of the

decedent’s death, can be asserted under applicable local law so

as to affect the disposition of the specially valued property by

the estate. Any person who at the decedent’s death has any

such interest in the property, whether present or future, or

vested or contingent, must enter into the agreement. Included

are owners of remainder and executory interests; the holders of

general or special powers of appointment; beneficiaries of a gift

over in default of exercise of any such power; joint tenants and

holders of similar undivided interests when the decedent held

only a joint or undivided interest in the property or when only an

undivided interest is specially valued; and trustees of trusts and

representatives of other entities holding title to, or holding any

interests in the property. An heir who has the power under local

law to caveat (challenge) a will and thereby affect disposition of

the property is not, however, considered to be a person with an

interest in property under section 2032A solely by reason of that

right. Likewise, creditors of an estate are not such persons

solely by reason of their status as creditors.

Part 2. Notice of Election

Line 10. Because the special-use valuation election creates a

potential tax liability for the recapture tax of section 2032A(c),

you must list each person who receives an interest in the

specially valued property on Schedule A-1. If there are more

than eight persons who receive interests, use an additional sheet

that follows the format of line 10. In the columns “Fair market

value” and “Special-use value,” you should enter the total

respective values of all the specially valued property interests

received by each person.

GST Tax Savings

If any person required to enter into the agreement either

desires that an agent act for him or her or cannot legally bind

himself or herself due to infancy or other incompetency, or due

to death before the election under section 2032A is timely

exercised, a representative authorized by local law to bind the

person in an agreement of this nature may sign the agreement

on his or her behalf.

Because the GST tax depends on the executor’s allocation of

the GST exemption and the grandchild exclusion, the skip

person who receives the interests is unable to compute this GST

tax savings. Therefore, for each skip person who receives an

interest in specially valued property, you must attach worksheets

showing the total GST tax savings attributable to all of that

person’s interests in specially valued property.

The Internal Revenue Service will contact the agent

designated in the agreement on all matters relating to continued

qualification under section 2032A of the specially valued real

property and on all matters relating to the special lien arising

under section 6324B. It is the duty of the agent as

attorney-in-fact for the parties with interests in the specially

valued property to furnish the IRS with any requested

information and to notify the IRS of any disposition or cessation

of qualified use of any part of the property.

How to compute the GST tax savings. Before computing each

skip person’s GST tax savings, you must complete Schedules R

and R-1 for the entire estate (using the special-use values).

For each skip person, you must complete two Schedules R

(Parts 2 and 3 only) as worksheets, one showing the interests in

Schedule A-1—Page 6

To compute the additional GST tax due upon disposition (or

cessation of qualified use) of the property, each “skip person”

(as defined in the instructions to Schedule R) who receives an

interest in the specially valued property must know the total GST

tax savings on all of the interests in specially valued property

received. This GST tax savings is the difference between the

total GST tax that was imposed on all of the interests in specially

valued property received by the skip person valued at their

special-use value and the total GST tax that would have been

imposed on the same interests received by the skip person had

they been valued at their fair market value.

specially valued property received by the skip person at their

special-use value and one showing the same interests at their

fair market value.

● Schedule R, Parts 2 and 3, lines 2 and 3, fixed taxes and other

charges. If valuing the interests at their fair market value (instead

of special-use value) causes any of these taxes and charges to

increase, enter the increased amount (only) on these lines and

attach an explanation of the increase. Otherwise, enter -0-.
Form 706 (Rev. 8-2008)

Schedule A-1—Page 7

Checklist for Section 2032A Election

To have a valid special-use valuation election under

section 2032A, you must file, in addition to the federal

estate tax return, (a) a notice of election (Schedule A-1,

Part 2), and (b) a fully executed agreement (Schedule

A-1, Part 3). You must include certain information in

the notice of election. To ensure that the notice of

election includes all of the information required for a

valid election, use the following checklist. The checklist

is for your use only. Do not file it with the return.

1. Does the notice of election include the decedent’s

name and social security number as they appear on

the estate tax return?

2. Does the notice of election include the relevant

qualified use of the property to be specially valued?

3. Does the notice of election describe the items of

real property shown on the estate tax return that are to

be specially valued and identify the property by the

Form 706 schedule and item number?

4. Does the notice of election include the fair market

value of the real property to be specially valued and

also include its value based on the qualified use

(determined without the adjustments provided in

section 2032A(b)(3)(B))?

5. Does the notice of election include the adjusted

value (as defined in section 2032A(b)(3)(B)) of (a) all real

property that both passes from the decedent and is

used in a qualified use, without regard to whether it is

to be specially valued, and (b) all real property to be

specially valued?

6. Does the notice of election include (a) the items of

personal property shown on the estate tax return that

pass from the decedent to a qualified heir and that are

used in qualified use and (b) the total value of such

personal property adjusted under section

2032A(b)(3)(B)?

7. Does the notice of election include the adjusted

value of the gross estate? (See section 2032A(b)(3)(A).)

8. Does the notice of election include the method

used to determine the special-use value?

9. Does the notice of election include copies of

written appraisals of the fair market value of the real

property?

10. Does the notice of election include a statement

that the decedent and/or a member of his or her family

has owned all of the specially valued property for at

11. Does the notice of election include a statement

as to whether there were any periods during the 8-year

period preceding the decedent’s date of death during

which the decedent or a member of his or her 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).)

12. Does the notice of election include, for each item

of specially valued property, the name of every person

taking an interest in that item of specially valued

property and the following information about each such

person: (a) the person’s address, (b) the person’s

taxpayer identification number, (c) the person’s

relationship to the decedent, and (d) the value of the

property interest passing to that person based on both

fair market value and qualified use?

13. Does the notice of election include affidavits

describing the activities constituting material

participation and the identity of the material

participants?

14. Does the notice of election include a legal

description of each item of specially valued property?

(In the case of an election made for qualified

woodlands, the information included in the notice of

election must include the reason for entitlement to the

Woodlands election.)

Any election made under section 2032A will not be

valid unless a properly executed agreement (Schedule

A-1, Part 3) is filed with the estate tax return. To

ensure that the agreement satisfies the requirements

for a valid election, use the following checklist.

1. Has the agreement been signed by each and

every qualified heir having an interest in the property

being specially valued?

2. Has every qualified heir expressed consent to

personal liability under section 2032A(c) in the event of

an early disposition or early cessation of qualified use?

3. Is the agreement that is actually signed by the

qualified heirs in a form that is binding on all of the

qualified heirs having an interest in the specially valued

property?

4. Does the agreement designate an agent to act for

the parties to the agreement in all dealings with the

IRS on matters arising under section 2032A?

5. Has the agreement been signed by the designated

agent and does it give the address of the agent?

least 5 years of the 8 years immediately preceding the

date of the decedent’s death? If you are going to make the special-use

valuation election on Schedule A-1, please

use this checklist to ensure that you are

providing everything necessary to make a

valid election. CAUTION
Form 706 (Rev. 8-2008)

Decedent’s Social Security Number

Estate of:

SCHEDULE A-1—Section 2032A Valuation

Part 1. Type of Election (Before making an election, see the checklist on page 7.):

Protective election (Regulations section 20.2032A-8(b)). Complete Part 2, line 1, and column A of lines 3 and 4. (see instructions)

Regular election. Complete all of Part 2 (including line 11, if applicable) and Part 3. (see instructions)

Part 2. Notice of Election (Regulations section 20.2032A-8(a)(3))

Note. All real property entered on lines 2 and 3 must also be entered on Schedules A, E, F, G, or H, as applicable.

Qualified use—check one Farm used for farming, or



1

Trade or business other than farming

2 Real property used in a qualified use, passing to qualified heirs, and to be specially valued on this Form 706.

A B C D

Schedule and item number

from Form 706

Value based on qualified use

(without section 2032A(b)(3)(B)

adjustment)

Adjusted value (with section

2032A(b)(3)(B) 

adjustment)

Totals

Attach a legal description of all property listed on line 2.

Attach copies of appraisals showing the column B values for all property listed on line 2.

3 Real property used in a qualified use, passing to qualified heirs, but not specially valued on this Form 706.

Totals

If you checked “Regular election,” you must attach copies of appraisals showing the column B values for all property listed on line 3.

(continued on next page) Schedule A-1—Page 8

Full value 

(without section 2032A(b)(3)(B)

adjustment)

A B C D

Schedule and item number

from Form 706

Value based on qualified use

(without section 2032A(b)(3)(B)

adjustment)

Adjusted value (with section

2032A(b)(3)(B) 

adjustment)

Full value 

(without section 2032A(b)(3)(B)

adjustment)

Before completing Schedule A-1, see the checklist on page 7 for the information and documents that must be included to make

a valid election.

The election is not valid unless the agreement (that is, Part 3. Agreement to Special Valuation Under Section 2032A):

● Is signed by each and every qualified heir with an interest in the specially valued property and

● Is attached to this return when it is filed.
Form 706 (Rev. 8-2008)

4 Personal property used in a qualified use and passing to qualified heirs.

A B A (continued) B (continued)

Adjusted value (with

section 2032A(b)(3)(B)

adjustment)

Schedule and item

number from Form 706

Adjusted value (with

section 2032A(b)(3)(B)

adjustment)

Schedule and item

number from Form 706

“Subtotal” from Col. B, below left

Subtotal Total adjusted value

5 Enter the value of the total gross estate as adjusted under section 2032A(b)(3)(A). 

6 Attach a description of the method used to determine the special value based on qualified use.

Did the decedent and/or a member of his or her family own all property listed on line 2 for at least 5 of the

8 years immediately preceding the date of the decedent’s death?

7

Yes No

Were there any periods during the 8-year period preceding the date of the decedent’s death during which

the decedent or a member of his or her family:

8

Yes No

a Did not own the property listed on line 2?

b Did not use the property listed on line 2 in a qualified use?

Did not materially participate in the operation of the farm or other business within the meaning of section

2032A(e)(6)?

c

If “Yes” to any of the above, you must attach a statement listing the periods. If applicable, describe whether the exceptions of

sections 2032A(b)(4) or (5) are met.

Attach affidavits describing the activities constituting material participation and the identity and relationship to the

decedent of the material participants.

9

10 Persons holding interests. Enter the requested information for each party who received any interest in the specially valued property.

Name Address

A

B

C

D

E

F

G

H

Identifying number Relationship to decedent Fair market value Special-use value

A

B

C

D

E

F

G

H

You must attach a computation of the GST tax savings attributable to direct skips for each person listed above who is a skip person. (see instructions)

Woodlands election. Check here if you wish to make a Woodlands election as described in section 2032A(e)(13). Enter the

schedule and item numbers from Form 706 of the property for which you are making this election 

11

You must attach a statement explaining why you are entitled to make this election. The IRS may issue regulations that require more

information to substantiate this election. You will be notified by the IRS if you must supply further information.

Schedule A-1—Page 9

(Each of the qualified heirs receiving an interest in the property must sign the agreement, and the agreement must be filed

with this return.)
Form 706 (Rev. 8-2008)

Decedent’s Social Security Number

Estate of:

We (list all qualified heirs and other persons having an interest in the property required to sign this agreement)

,

being all the qualified heirs and

,

being all other parties having interests in the property which is qualified real property and which is valued under section 2032A of the

Internal Revenue Code, do hereby approve of the election made by ,

Executor/Administrator of the estate of ,

pursuant to section 2032A to value said property on the basis of the qualified use to which the property is devoted and do hereby enter

into this agreement pursuant to section 2032A(d).

The undersigned agree and consent to the application of subsection (c) of section 2032A of the Code with respect to all the property

described on Form 706, Schedule A-1, Part 2, line 2, attached to this agreement. More specifically, the undersigned heirs expressly agree

and consent to personal liability under subsection (c) of 2032A for the additional estate and GST taxes imposed by that subsection with

respect to their respective interests in the above-described property in the event of certain early dispositions of the property or early

cessation of the qualified use of the property. It is understood that if a qualified heir disposes of any interest in qualified real property to

any member of his or her family, such member may thereafter be treated as the qualified heir with respect to such interest upon filing a

Form 706-A, United States Additional Estate Tax Return, and a new agreement.

The undersigned interested parties who are not qualified heirs consent to the collection of any additional estate and GST taxes imposed

under section 2032A(c) of the Code from the specially valued property.

If there is a disposition of any interest which passes, or has passed to him or her, or if there is a cessation of the qualified use of any

specially valued property which passes or passed to him or her, each of the undersigned heirs agrees to file a Form 706-A, and pay

any additional estate and GST taxes due within 6 months of the disposition or cessation.

It is understood by all interested parties that this agreement is a condition precedent to the election of special-use valuation under section

2032A of the Code and must be executed by every interested party even though that person may not have received the estate (or GST)

tax benefits or be in possession of such property.

Each of the undersigned understands that by making this election, a lien will be created and recorded pursuant to section 6324B of the

Code on the property referred to in this agreement for the adjusted tax differences with respect to the estate as defined in section

2032A(c)(2)(C).

As the interested parties, the undersigned designate the following individual as their agent for all dealings with the Internal Revenue Service

concerning the continued qualification of the specially valued property under section 2032A of the Code and on all issues regarding the

special lien under section 6324B. The agent is authorized to act for the parties with respect to all dealings with the Service on matters

affecting the qualified real property described earlier. This includes the authorization:

● To receive confidential information on all matters relating to continued qualification under section 2032A of the specially valued

real property and on all matters relating to the special lien arising under section 6324B;

● To furnish the Internal Revenue Service with any requested information concerning the property;

● To notify the Internal Revenue Service of any disposition or cessation of qualified use of any part of the property;

● To receive, but not to endorse and collect, checks in payment of any refund of Internal Revenue taxes, penalties, or interest;

● To execute waivers (including offers of waivers) of restrictions on assessment or collection of deficiencies in tax and waivers of

notice of disallowance of a claim for credit or refund; and

● To execute closing agreements under section 7121.

Schedule A-1— Page 10

● The agreement is executed by each and every one of the qualified heirs and

● The agreement is included with the estate tax return when the estate tax return is filed.

There cannot be a valid election unless:

(continued on next page)

Part 3. Agreement to Special Valuation Under Section 2032A
Form 706 (Rev. 8-2008)

Part 3. Agreement to Special Valuation Under Section 2032A (continued)

Decedent’s Social Security Number

Estate of:

● Other acts (specify) 

By signing this agreement, the agent agrees to provide the Internal Revenue Service with any requested information concerning this property

and to notify the Internal Revenue Service of any disposition or cessation of the qualified use of any part of this property.

Name of Agent Signature Address

The property to which this agreement relates is listed in Form 706, United States Estate (and Generation-Skipping Transfer) Tax Return,

and in the Notice of Election, along with its fair market value according to section 2031 of the Code and its special-use value according

to section 2032A. The name, address, social security number, and interest (including the value) of each of the undersigned in this property

are as set forth in the attached Notice of Election.

IN WITNESS WHEREOF, the undersigned have hereunto set their hands at ,

this day of .

SIGNATURES OF EACH OF THE QUALIFIED HEIRS:

Schedule A-1—Page 11

Signature of qualified heir

Signature of qualified heir

Signature of qualified heir

Signature of qualified heir

Signatures of other interested parties

Signatures of other interested parties

Signature of qualified heir

Signature of qualified heir

Signature of qualified heir

Signature of qualified heir

Signature of qualified heir

Signature of qualified heir

Signature of qualified heir

Signature of qualified heir
Form 706 (Rev. 8-2008)

Estate of:

SCHEDULE B—Stocks and Bonds

(For jointly owned property that must be disclosed on Schedule E, see the instructions for Schedule E.)

Alternate

valuation date

Description, including face amount of bonds or number of shares and par

value for identification. Give CUSIP number. If trust, partnership, or closely

held entity, give EIN

Item

number Unit value Alternate value Value at date of death

1

Total from continuation schedules (or additional sheets) attached to this schedule

TOTAL. (Also enter on Part 5—Recapitulation, page 3, at item 2.)

(If more space is needed, attach the continuation schedule from the end of this package or additional sheets of the same size.)

(The instructions to Schedule B are in the separate instructions.) Schedule B—Page 12

CUSIP number or EIN, 

where applicable

Decedent’s Social Security Number
Form 706 (Rev. 8-2008)

Estate of:

SCHEDULE C—Mortgages, Notes, and Cash

(For jointly owned property that must be disclosed on Schedule E, see the instructions for Schedule E.)

Alternate

valuation date

Item

number Description Alternate value Value at date of death

1

Total from continuation schedules (or additional sheets) attached to this schedule

TOTAL. (Also enter on Part 5—Recapitulation, page 3, at item 3.)

(If more space is needed, attach the continuation schedule from the end of this package or additional sheets of the same size.)

Schedule C—Page 13

(See the instructions on the reverse side.)

Decedent’s Social Security Number
Form 706 (Rev. 8-2008)

Instructions for Schedule C—

Mortgages, Notes, and Cash

Schedule C—Page 14

Complete Schedule C and file it with your return if the

total gross estate contains any:

● Mortgages,

● Notes, or

● Cash.

List on Schedule C:

● Mortgages and notes payable to the decedent at

the time of death.

● Cash the decedent had at the date of death.

Do not list on Schedule C:

● Mortgages and notes payable by the decedent. (If

these are deductible, list them on Schedule K.)

List the items on Schedule C in the following order:

1. Mortgages;

2. Promissory notes;

3. Contracts by decedent to sell land;

4. Cash in possession; and

5. Cash in banks, savings and loan associations,

and other types of financial organizations.

What to enter in the “Description” column:

For mortgages, list:

● Face value,

● Unpaid balance,

● Date of mortgage,

● Name of maker,

● Property mortgaged,

● Date of maturity,

● Interest rate, and

● Interest date.

Example to enter in “Description” column:

“Bond and mortgage of $50,000, unpaid balance:

$17,000; dated: January 1, 1992; John Doe to Richard

Roe; premises: 22 Clinton Street, Newark, NJ; due:

January 1, 2012; interest payable at 10% a

year—January 1 and July 1.”

For promissory notes, list in the same way as

mortgages.

For contracts by the decedent to sell land, list:

● Name of purchaser,

● Contract date,

● Property description,

● Sale price,

● Initial payment,

● Amounts of installment payment,

● Unpaid balance of principal, and

● Interest rate.

For cash in possession, list such cash separately from

bank deposits.

For cash in banks, savings and loan associations, and

other types of financial organizations, list:

● Name and address of each financial organization,

● Amount in each account,

● Serial or account number,

● Nature of account—checking, savings, time

deposit, etc., and

● Unpaid interest accrued from date of last interest

payment to the date of death.

Note. If you obtain statements from the financial

organizations, keep them for IRS inspection.
Form 706 (Rev. 8-2008)

Estate of:

SCHEDULE D—Insurance on the Decedent’s Life

You must list all policies on the life of the decedent and attach a Form 712 for each policy.

Alternate

valuation date

Item

number Description Alternate value Value at date of death

1

Total from continuation schedules (or additional sheets) attached to this schedule

TOTAL. (Also enter on Part 5—Recapitulation, page 3, at item 4.)

(If more space is needed, attach the continuation schedule from the end of this package or additional sheets of the same size.)

Schedule D—Page 15

(See the instructions on the reverse side.)

Decedent’s Social Security Number
Form 706 (Rev. 8-2008)

Schedule D—Page 16

If you are required to file Form 706 and there was any

insurance on the decedent’s life, whether or not

included in the gross estate, you must complete

Schedule D and file it with the return.

Insurance you must include on Schedule D. Under

section 2042, you must include in the gross estate:

● Insurance on the decedent’s life receivable by or

for the benefit of the estate; and

● Insurance on the decedent’s life receivable by

beneficiaries other than the estate, as described

below.

The term ‘‘insurance’’ refers to life insurance of every

description, including death benefits paid by fraternal

beneficiary societies operating under the lodge system,

and death benefits paid under no-fault automobile

insurance policies if the no-fault insurer was

unconditionally bound to pay the benefit in the event of

the insured’s death.

Insurance in favor of the estate. Include on

Schedule D the full amount of the proceeds of

insurance on the life of the decedent receivable by the

executor or otherwise payable to or for the benefit of

the estate. Insurance in favor of the estate includes

insurance used to pay the estate tax, and any other

taxes, debts, or charges that are enforceable against

the estate. The manner in which the policy is drawn is

immaterial as long as there is an obligation, legally

binding on the beneficiary, to use the proceeds to pay

taxes, debts, or charges. You must include the full

amount even though the premiums or other

consideration may have been paid by a person other

than the decedent.

Insurance receivable by beneficiaries other than the

estate. Include on Schedule D the proceeds of all

insurance on the life of the decedent not receivable by

or for the benefit of the decedent’s estate if the

decedent possessed at death any of the incidents of

ownership, exercisable either alone or in conjunction

with any person.

● The right of the insured or estate to its economic

benefits;

● The power to change the beneficiary;

Incidents of ownership in a policy include:

● The power to surrender or cancel the policy;

● The power to assign the policy or to revoke an

assignment;

● The power to pledge the policy for a loan;

● The power to obtain from the insurer a loan

against the surrender value of the policy; and

● A reversionary interest if the value of the

reversionary interest was more than 5% of the

value of the policy immediately before the

decedent died. (An interest in an insurance policy

is considered a reversionary interest if, for

example, the proceeds become payable to the

insured’s estate or payable as the insured directs if

the beneficiary dies before the insured.)

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 transferred by the decedent

in such a way that it would be includible in the gross

estate under section 2036, 2037, or 2038. See the

instructions to Schedule G for a description of these

sections.

Completing the Schedule

You must list every policy of insurance on the life of

the decedent, whether or not it is included in the gross

estate.

Under “Description,” list:

● The name of the insurance company, and

● The number of the policy.

For every policy of life insurance listed on the

schedule, you must request a statement on Form 712,

Life Insurance Statement, from the company that 

issued the policy. Attach the Form 712 to the back of

Schedule D.

If part or all of the policy proceeds are not included

in the gross estate, you must explain why they were

not included.

If the policy proceeds are paid in one sum, enter the

net proceeds received (from Form 712, line 24) in the

value (and alternate value) columns of Schedule D. If

the policy proceeds are not paid in one sum, enter the

value of the proceeds as of the date of the decedent’s

death (from Form 712, line 25).

Instructions for Schedule D—Insurance on

the Decedent’s Life
Form 706 (Rev. 8-2008)

Estate of:

SCHEDULE E—Jointly Owned Property

(If you elect section 2032A valuation, you must complete Schedule E and Schedule A-1.)

PART 1. Qualified Joint Interests—Interests Held by the Decedent and His or Her Spouse as the Only Joint

Tenants (Section 2040(b)(2))

Description. For securities, give CUSIP number. If trust, partnership, or

closely held entity, give EIN

Alternate

valuation date

Item

number Alternate value Value at date of death

Total from continuation schedules (or additional sheets) attached to this schedule

1a Totals

1b Amounts included in gross estate (one-half of line 1a)

PART 2. All Other Joint Interests

2a State the name and address of each surviving co-tenant. If there are more than three surviving co-tenants, list the additional co-tenants

on an attached sheet.

Name Address (number and street, city, state, and ZIP code)

A.

B.

C.

Enter

letter for

co-tenant

Description (including alternate valuation date if any). For securities, give

CUSIP number. If trust, partnership, or closely held entity, give EIN

Includible value at

date of death

Includible

alternate value

Percentage

includible

Item

number

Total from continuation schedules (or additional sheets) attached to this schedule

2b Total other joint interests

3

(If more space is needed, attach the continuation schedule from the end of this package or additional sheets of the same size.)

(See the instructions on the reverse side.) Schedule E—Page 17

1a

1b

2b

Total includible joint interests (add lines 1b and 2b). Also enter on Part 5—Recapitulation,

page 3, at item 5 3

1

1

CUSIP number or

EIN, where

applicable

CUSIP number or

EIN, where

applicable

Decedent’s Social Security Number
Form 706 (Rev. 8-2008)

Schedule E—Page 18

For each item of property, enter the appropriate

letter A, B, C, etc., from line 2a to indicate the name

and address of the surviving co-tenant.

Under “Description,” describe the property as

required in the instructions for Schedules A, B, C, and

F for the type of property involved.

In the “Percentage includible” column, enter the

percentage of the total value of the property that you

intend to include in the gross estate.

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 property originally belonged to the

other tenant or tenants and was never received or

acquired by the other tenant or tenants from the

decedent for less than adequate and full consideration

in money or money’s worth, or unless you can show

that any part of the property was acquired with

consideration originally belonging to the surviving joint

tenant or tenants. In this case, you may exclude from

the value of the property an amount proportionate to

the consideration furnished by the other tenant or

tenants. Relinquishing or promising to relinquish dower,

curtesy, or statutory estate created instead of dower or

curtesy, or other marital rights in the decedent’s

property or estate is not consideration in money or

money’s worth. See the Schedule A instructions for the

value to show for real property that is subject to a

mortgage.

If the property was acquired by the decedent and

another person or persons by gift, bequest, devise, or

inheritance as joint tenants, and their interests are not

otherwise specified by law, include only that part of the

value of the property that is figured by dividing the full

value of the property by the number of joint tenants.

If you believe that less than the full value of the

entire property is includible in the gross estate for tax

purposes, you must establish the right to include the

smaller value by attaching proof of the extent, origin,

and nature of the decedent’s interest and the

interest(s) of the decedent’s co-tenant or co-tenants.

In the “Includible alternate value” and “Includible

value at date of death” columns, you should enter only

the values that you believe are includible in the gross

estate.

Part 2. All other joint interests. All joint interests that

were not entered in Part 1 must be entered in Part 2.

Instructions for Schedule E—Jointly Owned

Property

If you are required to file Form 706, you must complete

Schedule E and file it with the return if the decedent

owned any joint property at the time of death, whether

or not the decedent’s interest is includible in the gross

estate.

Enter on this schedule all property of whatever kind

or character, whether real estate, personal property, or

bank accounts, in which the decedent held at the time

of death an interest either as a joint tenant with right to

survivorship or as a tenant by the entirety.

Do not list on this schedule property that the

decedent held as a tenant in common, but report the

value of the interest on Schedule A if real estate, or on

the appropriate schedule if personal property. Similarly,

community property held by the decedent and spouse

should be reported on the appropriate Schedules A

through I. The decedent’s interest in a partnership

should not be entered on this schedule unless the

partnership interest itself is jointly owned. Solely

owned partnership interests should be reported on

Schedule F, “Other Miscellaneous Property Not

Reportable Under Any Other Schedule.”

Part 1. Qualified joint interests held by decedent

and spouse. Under section 2040(b)(2), a joint interest

is a qualified joint interest if the decedent and the

surviving spouse held the interest as:

● Tenants by the entirety, or

● Joint tenants with right of survivorship if the

decedent and the decedent’s spouse are the only

joint tenants.

Interests that meet either of the two requirements

above should be entered in Part 1. Joint interests that

do not meet either of the two requirements above

should be entered in Part 2.

Under “Description,” describe the property as

required in the instructions for Schedules A, B, C, and

F for the type of property involved. For example, jointly

held stocks and bonds should be described using the

rules given in the instructions to Schedule B.

Under “Alternate value” and “Value at date of

death,” enter the full value of the property.

Note. You cannot claim the special treatment under

section 2040(b) for property held jointly by a decedent

and a surviving spouse who is not a U.S. citizen. You

must report these joint interests on Part 2 of

Schedule E, not Part 1.
Form 706 (Rev. 8-2008)

Estate of:

SCHEDULE F—Other Miscellaneous Property Not Reportable Under Any Other Schedule

(For jointly owned property that must be disclosed on Schedule E, see the instructions for Schedule E.)

(If you elect section 2032A valuation, you must complete Schedule F and Schedule A-1.)

Yes No 1 Did the decedent at the time of death own any works of art or items with collectible value in excess of $3,000 or

any collections whose artistic or collectible value combined at date of death exceeded $10,000?

If “Yes,” submit full details on this schedule and attach appraisals.

2 Has the decedent’s estate, spouse, or any other person, received (or will receive) any bonus or award as a result of

the decedent’s employment or death?

3 Did the decedent at the time of death have, or have access to, a safe deposit box?

If ‘‘Yes,’’ state location, and if held in joint names of decedent and another, state name and relationship of joint

depositor.

If any of the contents of the safe deposit box are omitted from the schedules in this return, explain fully why

omitted.

Description. For securities, give CUSIP number. If trust, partnership, or

closely held entity, give EIN

Alternate

valuation date

Item

number Alternate value Value at date of death

1

Total from continuation schedules (or additional sheets) attached to this schedule

TOTAL. (Also enter on Part 5—Recapitulation, page 3, at item 6.)

(If more space is needed, attach the continuation schedule from the end of this package or additional sheets of the same size.)

(See the instructions on the reverse side.)

Schedule F—Page 19

If “Yes,” submit full details on this schedule.

CUSIP number or

EIN, where

applicable

Decedent’s Social Security Number
Form 706 (Rev. 8-2008)

● Household goods and personal effects, including

wearing apparel;

Instructions for Schedule F—Other

Miscellaneous Property

● Farm products and growing crops;

You must complete Schedule F and file it with the

return.

● Livestock;

On Schedule F, list all items that must be included in the

gross estate that are not reported on any other schedule,

including:

● Farm machinery; and

● Automobiles.

Interests. If the decedent owned any interest in a

partnership or unincorporated business, attach a statement

of assets and liabilities for the valuation date and for the 5

years before the valuation date. Also, attach statements of

the net earnings for the same 5 years. Be sure to include the

EIN of the entity. You must account for goodwill in the

valuation. In general, furnish the same information and follow

the methods used to value close corporations. See the

instructions for Schedule B.

● Debts due the decedent (other than notes and

mortgages included on Schedule C);

● Interests in business;

● Insurance on the life of another (obtain and attach Form

712, Life Insurance Statement, for each policy).

Note (for single premium or paid-up policies). In certain

situations, for example where the surrender value of the

policy exceeds its replacement cost, the true economic

value of the policy will be greater than the amount shown

on line 59 of Form 712. In these situations, you should

report the full economic value of the policy on Schedule F.

See Rev. Rul. 78-137, 1978-1 C.B. 280 for details.

All partnership interests should be reported on Schedule F

unless the partnership interest, itself, is jointly owned. Jointly

owned partnership interests should be reported on Schedule E.

If real estate is owned by the sole proprietorship, it should

be reported on Schedule F and not on Schedule A. Describe

the real estate with the same detail required for Schedule A.

● Section 2044 property (see Decedent Who Was a

Surviving Spouse below);

● Claims (including the value of the decedent’s interest in

a claim for refund of income taxes or the amount of the

refund actually received);

Line 1. If the decedent owned at the date of death works of

art or items with collectible value (for example, jewelry, furs,

silverware, books, statuary, vases, oriental rugs, coin or

stamp collections), check the “Yes” box on line 1 and

provide full details. If any one work of art or item with

collectible value is valued at more than $3,000, or any

collection of similar articles is valued at more than $10,000,

attach an appraisal by an expert under oath and the required

statement regarding the appraiser’s qualifications (see

Regulations section 20.2031-6(b)).

● Rights;

● Royalties;

● Leaseholds;

● Judgments;

● Reversionary or remainder interests;

Schedule F—Page 20

● Shares in trust funds (attach a copy of the trust

instrument);

Decedent Who Was a Surviving Spouse

If the decedent was a surviving spouse, he or she may have

received qualified terminable interest property (QTIP) from the

predeceased spouse for which the marital deduction was

elected either on the predeceased spouse’s estate tax return

or on a gift tax return, Form 709. The election was available

for gifts made and decedents dying after December 31,

1981. List such property on Schedule F.

If this election was made and the surviving spouse retained

his or her interest in the QTIP property at death, the full value

of the QTIP property is includible in his or her estate, even

though the qualifying income interest terminated at death. It

is valued as of the date of the surviving spouse’s death, or

alternate valuation date, if applicable. Do not reduce the

value by any annual exclusion that may have applied to the

transfer creating the interest.

The value of such property included in the surviving

spouse’s gross estate is treated as passing from the

surviving spouse. It therefore qualifies for the charitable and

marital deductions on the surviving spouse’s estate tax return

if it meets the other requirements for those deductions.

For additional details, see Regulations section 20.2044-1.

● Any interest in an Archer medical savings account

(MSA) or health savings account (HSA), unless such

interest passes to the surviving spouse; and

schedule owned by the decedent at the time of death, attach

a statement which lists the item number from Schedule F

and identifies the total accumulated discount taken (that is,

XX.XX%) on such interest.

If you answered “Yes” to line 10b for an interest in a limited

liability company owned by the decedent at the time of death,

attach a statement which lists the item number from Schedule

F and identifies the effective discount taken on such interest.

If you answered “Yes” to line 10b for any transfer(s)

described in (1) through (5) on pages 15 and 16 of the

separate Form 706 instructions (and made by the decedent),

attach a statement to Schedule G which lists the item

number from that schedule and identifies the total

accumulated discount taken (that is, XX.XX%) on such

transfer(s).

Example of effective discount:

a Pro-rata value of limited liability company (before any 

discounts)

b Minus: 10% discounts for lack of control

c Marketable minority interest value (as if freely traded minority

interest value)

d Minus: 15% discount for lack of marketability

e Non-marketable minority interest value $76.50

$100.00

(10.00)

$90.00

(13.50)

Valuation discounts. If you answered “Yes” to Part

4—General Information, line 10b for any interest in

miscellaneous property not reportable under any other

Calculation of effective discount:

(a minus e ) divided by a = effective discount

($100.00 - $76.50) $100.00 = 23.50%

Note. The amount of discounts are based on the factors

pertaining to a specific interest and those discounts shown in

the example are for demonstration purposes only.
Form 706 (Rev. 8-2008)

Estate of:

SCHEDULE G—Transfers During Decedent’s Life

(If you elect section 2032A valuation, you must complete Schedule G and Schedule A-1.)

Description. For securities, give CUSIP number. If trust,

partnership, or closely held entity, give EIN

Alternate

valuation date

Item

number Alternate value Value at date of death

Gift tax paid or payable by the decedent or the estate for all gifts

made by the decedent or his or her spouse within 3 years before

the decedent’s death (section 2035(b))

A.

X X X X X

B. Transfers includible under section 2035(a), 2036, 2037, or 2038:

1

Total from continuation schedules (or additional sheets) attached to this schedule

TOTAL. (Also enter on Part 5—Recapitulation, page 3, at item 7.)

SCHEDULE H—Powers of Appointment

(If you elect section 2032A valuation, you must complete Schedule H and Schedule A-1.)

1

Total from continuation schedules (or additional sheets) attached to this schedule

TOTAL. (Also enter on Part 5—Recapitulation, page 3, at item 8.)

(If more space is needed, attach the continuation schedule from the end of this package or additional sheets of the same size.)

(The instructions to Schedules G and H are in the separate instructions.) Schedules G and H—Page 21

Description Alternate

valuation date

Item

number Alternate value Value at date of death

(Include “5 and 5 lapsing” powers (section 2041(b)(2)) held by the decedent.)

Decedent’s Social Security Number
Form 706 (Rev. 8-2008)

Estate of:

SCHEDULE I—Annuities

Note. Generally, no exclusion is allowed for the estates of decedents dying after December 31, 1984 (see page 17 of the instructions).

Yes No Are you excluding from the decedent’s gross estate the value of a lump-sum distribution described in section

2039(f)(2) (as in effect before its repeal by the Deficit Reduction Act of 1984)?

A

If “Yes,” you must attach the information required by the instructions.

Includible 

value at date of death

Includible

alternate value

Alternate

valuation date

Description.

Show the entire value of the annuity before any exclusions

Item

number

1

Total from continuation schedules (or additional sheets) attached to this schedule

TOTAL. (Also enter on Part 5—Recapitulation, page 3, at item 9.)

(If more space is needed, attach the continuation schedule from the end of this package or additional sheets of the same size.)

Schedule I—Page 22 (The instructions to Schedule I are in the separate instructions.)

Decedent’s Social Security Number
Form 706 (Rev. 8-2008)

Estate of:

SCHEDULE J—Funeral Expenses and Expenses Incurred in Administering Property Subject to Claims

Note. Do not list on this schedule expenses of administering property not subject to claims. For those expenses, see the instructions

for Schedule L.

If executors’ commissions, attorney fees, etc., are claimed and allowed as a deduction for estate tax purposes, they are not

allowable as a deduction in computing the taxable income of the estate for federal income tax purposes. They are allowable as

an income tax deduction on Form 1041 if a waiver is filed to waive the deduction on Form 706 (see the Form 1041 instructions).

Item

number Description Expense amount Total amount

A. Funeral expenses:

1

Total funeral expenses 

B. Administration expenses:

Executors’ commissions—amount estimated/agreed upon/paid. (Strike out the words that do

not apply.)

1

2 Attorney fees—amount estimated/agreed upon/paid. (Strike out the words that do not apply.)

3 Accountant fees—amount estimated/agreed upon/paid. (Strike out the words that do not apply.)

Expense amount

4 Miscellaneous expenses:

Total miscellaneous expenses from continuation schedules (or additional sheets)

attached to this schedule

Total miscellaneous expenses 

TOTAL. (Also enter on Part 5—Recapitulation, page 3, at item 13.) 

(If more space is needed, attach the continuation schedule from the end of this package or additional sheets of the same size.)

Schedule J—Page 23 (See the instructions on the reverse side.)

Decedent’s Social Security Number
Form 706 (Rev. 8-2008)

On Schedule J, itemize funeral expenses and expenses

incurred in administering property subject to claims. List

the names and addresses of persons to whom the

expenses are payable and describe the nature of the

expense. Do not list expenses incurred in

administering property not subject to claims on this

schedule. List them on Schedule L instead.

Do not deduct on this schedule amounts paid as

trustees’ commissions whether received by you acting in

the capacity of a trustee or by a separate trustee. If such

amounts were paid in administering property not subject

to claims, deduct them on Schedule L.

Note. Executors’ commissions are taxable income to the

executors. Therefore, be sure to include them as income

on your individual income tax return.

Funeral expenses. Itemize funeral expenses on line A.

Deduct from the expenses any amounts that were

reimbursed, such as death benefits payable by the Social

Security Administration and the Veterans Administration.

Attorney fees. Enter the amount of attorney fees that

have actually been paid or that you reasonably expect to

be paid. If on the final examination of the return, the fees

claimed have not been awarded by the proper court and

paid, the deduction will be allowed provided the Estate

and Gift Tax Territory Manager is reasonably satisfied that

the amount claimed will be paid and that it does not

exceed a reasonable payment for the services performed,

taking into account the size and character of the estate

and the local law and practice. If the fees claimed have

not been paid at the time of final examination of the

return, the amount deducted must be supported by an

affidavit, or statement signed under the penalties of

perjury, by the executor or the attorney stating that the

amount has been agreed upon and will be paid.

Executors’ commissions. When you file the return, you

may deduct commissions that have actually been paid to

you or that you expect will be paid. You may not deduct

commissions if none will be collected. If the amount of

the commissions has not been fixed by decree of the

proper court, the deduction will be allowed on the final

examination of the return, provided that:

● The Estate and Gift Tax Territory Manager is reasonably

satisfied that the commissions claimed will be paid;

● The amount entered as a deduction is within the

amount allowable by the laws of the jurisdiction where

the estate is being administered; and

Do not deduct attorney fees incidental to litigation

incurred by the beneficiaries. These expenses are charged

against the beneficiaries personally and are not

administration expenses authorized by the Code.

● It is in accordance with the usually accepted practice in

that jurisdiction for estates of similar size and character.

If you have not been paid the commissions claimed at

the time of the final examination of the return, you must

Schedule J—Page 24

Miscellaneous expenses. Miscellaneous administration

expenses necessarily incurred in preserving and

distributing the estate are deductible. These expenses

include appraiser’s and accountant’s fees, certain court

costs, and costs of storing or maintaining assets of the

estate.

The expenses of selling assets are deductible only if the

sale is necessary to pay the decedent’s debts, the

expenses of administration, or taxes, or to preserve the

estate or carry out distribution.

The deduction is limited to the amount paid for these

expenses that is allowable under local law but may not

exceed:

1. The value of property subject to claims included in

the gross estate, plus

2. The amount paid out of property included in the

gross estate but not subject to claims. This amount must

actually be paid by the due date of the estate tax return.

The applicable local law under which the estate is being

administered determines which property is and is not

subject to claims. If under local law a particular property

interest included in the gross estate would bear the

burden for the payment of the expenses, then the

property is considered property subject to claims.

Unlike certain claims against the estate for debts of the

decedent (see the instructions for Schedule K in the

separate instructions), you cannot deduct expenses

incurred in administering property subject to claims on

both the estate tax return and the estate’s income tax

return. If you choose to deduct them on the estate tax

return, you cannot deduct them on a Form 1041 filed for

the estate. Funeral expenses are only deductible on the

estate tax return.

Interest expense. Interest expenses incurred after the

decedent’s death are generally allowed as a deduction if

they are reasonable, necessary to the administration of

the estate, and allowable under local law.

Interest incurred as the result of a federal estate tax

deficiency is a deductible administrative expense.

Penalties are not deductible even if they are allowable

under local law.

You may not deduct a bequest or devise made to

you instead of commissions. If, however, the decedent

fixed by will the compensation payable to you for

services to be rendered in the administration of the

estate, you may deduct this amount to the extent it is not

more than the compensation allowable by the local law or

practice.

General. You must complete and file Schedule J if you

claim a deduction on item 13 of Part 5—Recapitulation.

Note. If you elect to pay the tax in installments under

section 6166, you may not deduct the interest payable on

the installments.

support the amount you deducted with an affidavit or

statement signed under the penalties of perjury that the

amount has been agreed upon and will be paid.

Instructions for Schedule J—Funeral

Expenses and Expenses Incurred in

Administering Property Subject to Claims
Form 706 (Rev. 8-2008)

Estate of:

SCHEDULE K—Debts of the Decedent, and Mortgages and Liens

Amount claimed as

a deduction

Item

number

Amount unpaid to date Amount in contest Debts of the Decedent—Creditor and nature of claim, and

allowable death taxes

1

Total from continuation schedules (or additional sheets) attached to this schedule

TOTAL. (Also enter on Part 5—Recapitulation, page 3, at item 14.)

Mortgages and Liens—Description Amount

1

Total from continuation schedules (or additional sheets) attached to this schedule

TOTAL. (Also enter on Part 5—Recapitulation, page 3, at item 15.)

(If more space is needed, attach the continuation schedule from the end of this package or additional sheets of the same size.)

(The instructions to Schedule K are in the separate instructions.) Schedule K—Page 25

Item

number

Decedent’s Social Security Number
Form 706 (Rev. 8-2008)

Estate of:

SCHEDULE L—Net Losses During Administration and 

Expenses Incurred in Administering Property Not Subject to Claims

Item Net losses during administration

number Amount (Note. Do not deduct losses claimed on a federal income tax return.)

1

Total from continuation schedules (or additional sheets) attached to this schedule

TOTAL. (Also enter on Part 5—Recapitulation, page 3, at item 18.)

Expenses incurred in administering property not subject to

claims. (Indicate whether estimated, agreed upon, or paid.)

Item

number Amount

1

Total from continuation schedules (or additional sheets) attached to this schedule

TOTAL. (Also enter on Part 5—Recapitulation, page 3, at item 19.)

(If more space is needed, attach the continuation schedule from the end of this package or additional sheets of the same size.)

Schedule L—Page 26 (The instructions to Schedule L are in the separate instructions.)

Decedent’s Social Security Number
Form 706 (Rev. 8-2008)

Estate of:

SCHEDULE M—Bequests, etc., to Surviving Spouse

Yes No

1 Did any property pass to the surviving spouse as a result of a qualified disclaimer?

If ‘‘Yes,’’ attach a copy of the written disclaimer required by section 2518(b).

Is the surviving spouse a U.S. citizen?

Election Out of QTIP Treatment of Annuities. Do you elect under section 2056(b)(7)(C)(ii) not to treat as qualified

terminable interest property any joint and survivor annuities that are included in the gross estate and would otherwise

be treated as qualified terminable interest property under section 2056(b)(7)(C)? (see instructions)

Item

number

Description of property interests passing to surviving spouse.

For securities, give CUSIP number. If trust, partnership, or closely held entity, give EIN Amount

A1

Total from continuation schedules (or additional sheets) attached to this schedule

Total amount of property interests listed on Schedule M

(If more space is needed, attach the continuation schedule from the end of this package or additional sheets of the same size.)

(See the instructions on the reverse side.)

Schedule M—Page 27

Election To Deduct Qualified Terminable Interest Property Under Section 2056(b)(7). If a trust (or other property) meets the

requirements of qualified terminable interest property under section 2056(b)(7), and

a. The trust or other property is listed on Schedule M and

then unless the executor specifically identifies the trust (all or a fractional portion or percentage) or other property to be

excluded from the election, the executor shall be deemed to have made an election to have such trust (or other property)

treated as qualified terminable interest property under section 2056(b)(7).

In what country was the surviving spouse born?

b. The value of the trust (or other property) is entered in whole or in part as a deduction on Schedule M,

What is the surviving spouse’s date of birth?

If the surviving spouse is a naturalized citizen, when did the surviving spouse acquire citizenship?

If the surviving spouse is not a U.S. citizen, of what country is the surviving spouse a citizen?

2a

3

b

c

d

e

If less than the entire value of the trust (or other property) that the executor has included in the gross estate is entered as a

deduction on Schedule M, the executor shall be considered to have made an election only as to a fraction of the trust (or other

property). The numerator of this fraction is equal to the amount of the trust (or other property) deducted on Schedule M. The

denominator is equal to the total value of the trust (or other property).

4

5a

6

b

c

d

Federal estate taxes payable out of property interests listed on Schedule M

Other death taxes payable out of property interests listed on Schedule M

Add items 5a, 5b, and 5c

Net amount of property interests listed on Schedule M (subtract 5d from 4). Also enter on 

Part 5—Recapitulation, page 3, at item 20

Federal and state GST taxes payable out of property interests listed

on Schedule M

4

6

5d

5c

5b

5a

Election To Deduct Qualified Domestic Trust Property Under Section 2056A. If a trust meets the requirements of a qualified

domestic trust under section 2056A(a) and this return is filed no later than 1 year after the time prescribed by law (including

extensions) for filing the return, and

a. The entire value of a trust or trust property is listed on Schedule M and

b. The entire value of the trust or trust property is entered as a deduction on Schedule M, then unless the executor specifically

identifies the trust to be excluded from the election, the executor shall be deemed to have made an election to have the entire

trust treated as qualified domestic trust property.

1

2c

3

QTIP property:

B1

All other property:

Decedent’s Social Security Number
Form 706 (Rev. 8-2008)

Schedule M—Page 28

Examples of Listing of Property Interests on Schedule M

Item

number

Description of property interests passing to surviving spouse. 

For securities, give CUSIP number. If trust, partnership, or closely held entity, give EIN Amount

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 I, item 1)

B1

$182,500

Proceeds of Metropolitan Life Insurance Company policy No. 104729, payable in one sum to surviving spouse

(Schedule D, item 3)

B2

200,000

B3 Cash bequest under Paragraph Six of will 100,000

Instructions for Schedule M—Bequests,

etc., to Surviving Spouse (Marital

Deduction)

General

The marital deduction is authorized by section 2056 for

certain property interests that pass from the decedent to the

surviving spouse. You may claim the deduction only for

property interests that are included in the decedent’s gross

estate (Schedules A through I).

Note. The marital deduction is generally not allowed if the

surviving spouse is not a U.S. citizen. The marital deduction

is allowed for property passing to such a surviving spouse in

a qualified domestic trust (QDOT) or if such property is

transferred or irrevocably assigned to such a trust before the

estate tax return is filed. The executor must elect qualified

domestic trust status on this return. See the instructions that

follow, on pages 29 and 30, for details on the election.

Property Interests That You May List on

Schedule M

For the rules on common disaster and survival for a limited

period, see section 2056(b)(3).

You may list on Schedule M only those interests that the

surviving spouse takes:

1. As the decedent’s legatee, devisee, heir, or donee;

2. As the decedent’s surviving tenant by the entirety or

joint tenant;

3. As an appointee under the decedent’s exercise of a

power or as a taker in default at the decedent’s nonexercise

of a power;

4. As a beneficiary of insurance on the decedent’s life;

5. As the surviving spouse taking under dower or curtesy

(or similar statutory interest); and

6. As a transferee of a transfer made by the decedent at

any time.

Property Interests That You May Not List on

Schedule M

1. The value of any property that does not pass from the

decedent to the surviving spouse;

2. Property interests that are not included in the

decedent’s gross estate;

3. The full value of a property interest for which a

deduction was claimed on Schedules J through L. The value

of the property interest should be reduced by the deductions

claimed with respect to it;

4. The full value of a property interest that passes to the

surviving spouse subject to a mortgage or other

encumbrance or an obligation of the surviving spouse.

Include on Schedule M only the net value of the interest after

reducing it by the amount of the mortgage or other debt;

5. Nondeductible terminable interests (described below); or

6. Any property interest disclaimed by the surviving

spouse.

Terminable Interests

The ownership of a bond, note, or other contractual

obligation, which when discharged would not have the effect

of an annuity for life or for a term, is not considered a

terminable interest.

Nondeductible terminable interests. A terminable interest is

nondeductible. Unless you are making a QTIP election, a

terminable interest should not be entered on Schedule M if:

1. Another interest in the same property passed from the

decedent to some other person for less than adequate and

full consideration in money or money’s worth; and

2. By reason of its passing, the other person or that

person’s heirs may enjoy part of the property after the

termination of the surviving spouse’s interest.

This rule applies even though the interest that passes from

the decedent to a person other than the surviving spouse is

not included in the gross estate, and regardless of when the

interest passes. The rule also applies regardless of whether

the surviving spouse’s interest and the other person’s

interest pass from the decedent at the same time.

For example, a decedent devised real property to his wife

for life, with remainder to his children. The life interest that

passed to the wife does not qualify for the marital deduction

because it will terminate at her death and the children will

thereafter possess or enjoy the property.

However, if the decedent purchased a joint and survivor

annuity for himself and his wife who survived him, the value

of the survivor’s annuity, to the extent that it is included in

the gross estate, qualifies for the marital deduction because

You must complete Schedule M and file it with the return if

you claim a deduction on Part 5—Recapitulation, item 20.

Generally, you may list on Schedule M all property interests

that pass from the decedent to the surviving spouse and are

included in the gross estate. However, you should not list

any nondeductible terminable interests (described below) on

Schedule M unless you are making a QTIP election. The

property for which you make this election must be included

on Schedule M. See Qualified terminable interest property on

the following page.

You should not list on Schedule M:

Certain interests in property passing from a decedent to a

surviving spouse are referred to as “terminable interests.”

These are interests that will terminate or fail after the

passage of time, or on the occurrence or nonoccurrence of

some contingency. Examples are: life estates, annuities,

estates for terms of years, and patents.

Property interests that are considered to pass to a person

other than the surviving spouse are any property interest

that: (a) passes under a decedent’s will or intestacy; (b) was

transferred by a decedent during life; or (c) is held by or

passed on to any person as a decedent’s joint tenant, as

appointee under a decedent’s exercise of a power, as taker

in default at a decedent’s release or nonexercise of a power,

or as a beneficiary of insurance on the decedent’s life.

All other property:
Form 706 (Rev. 8-2008)

Schedule M—Page 29

If any property interest passing from the decedent to the

surviving spouse may be paid or otherwise satisfied out of

any of a group of assets, the value of the property interest is,

for the entry on Schedule M, reduced by the value of any

asset or assets that, if passing from the decedent to the

surviving spouse, would be nondeductible terminable

interests. Examples of property interests that may be paid or

otherwise satisfied out of any of a group of assets are a

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

estate.

Example. A decedent bequeathed $100,000 to the

surviving spouse. The general estate includes a term for

years (valued at $10,000 in determining the value of the

gross estate) in an office building, which interest was

retained by the decedent under a deed of the building by gift

to a son. Accordingly, the value of the specific bequest

entered on Schedule M is $90,000.

Life estate with power of appointment in the surviving

spouse. A property interest, whether or not in trust, will be

treated as passing to the surviving spouse, and will not be

treated as a nondeductible terminable interest if: (a) the

surviving spouse is entitled for life to all of the income from

the entire interest; (b) the income is payable annually or at

more frequent intervals; (c) the surviving spouse has the

power, exercisable in favor of the surviving spouse or the

estate of the surviving spouse, to appoint the entire interest;

(d) the power is exercisable by the surviving spouse alone

and (whether exercisable by will or during life) is exercisable

by the surviving spouse in all events; and (e) no part of the

entire interest is subject to a power in any other person to

appoint any part to any person other than the surviving

spouse (or the surviving spouse’s legal representative or

relative if the surviving spouse is disabled. See Rev. Rul.

85-35, 1985-1 C.B. 328). If these five conditions are satisfied

only for a specific portion of the entire interest, see the

section 2056(b) regulations to determine the amount of the

marital deduction.

Life insurance, endowment, or annuity payments, with

power of appointment in surviving spouse. A property

interest consisting of the entire proceeds under a life

insurance, endowment, or annuity contract is treated as

passing from the decedent to the surviving spouse, and will

not be treated as a nondeductible terminable interest if: (a)

the surviving spouse is entitled to receive the proceeds in

installments, or is entitled to interest on them, with all

amounts payable during the life of the spouse, payable only

to the surviving spouse; (b) the installment or interest

payments are payable annually, or more frequently, beginning

not later than 13 months after the decedent’s death; (c) the

surviving spouse has the power, exercisable in favor of the

surviving spouse or of the estate of the surviving spouse, to

appoint all amounts payable under the contract; (d) the

power is exercisable by the surviving spouse alone and

(whether exercisable by will or during life) is exercisable by

the surviving spouse in all events; and (e) no part of the

amount payable under the contract is subject to a power in

Charitable remainder trusts. An interest in a charitable

remainder trust will not be treated as a nondeductible

terminable interest if:

1. The interest in the trust passes from the decedent to the

surviving spouse, and

2. The surviving spouse is the only beneficiary of the trust

other than charitable organizations described in section

170(c).

A charitable remainder trust is either a charitable remainder

annuity trust or a charitable remainder unitrust. (See section

664 for descriptions of these trusts.)

Election To Deduct Qualified Terminable Interests

(QTIP)

If you file a Form 706 in which you do not make this

election, you may not file an amended return to make the

election unless you file the amended return on or before the

due date for filing the original Form 706.

The effect of the election is that the property (interest) will

be treated as passing to the surviving spouse and will not be

treated as a nondeductible terminable interest. All of the

other marital deduction requirements must still be satisfied

before you may make this election. For example, you may

not make this election for property or property interests that

are not included in the decedent’s gross estate.

Qualified terminable interest property. Qualified terminable

interest property is property (a) that passes from the

decedent, and (b) in which the surviving spouse has a

qualifying income interest for life.

The surviving spouse has a qualifying income interest for

life if the surviving spouse is entitled to all of the income

from the property payable annually or at more frequent

intervals, or has a usufruct interest for life in the property,

and during the surviving spouse’s lifetime no person has a

power to appoint any part of the property to any person

other than the surviving spouse. An annuity is treated as an

income interest regardless of whether the property from

which the annuity is payable can be separately identified.

You may elect to claim a marital deduction for qualified

terminable interest property or property interests. You make

the QTIP election simply by listing the qualified terminable

interest property on Schedule M and deducting its value. You

are presumed to have made the QTIP election if you list the

property and deduct its value on Schedule M. If you make

this election, the surviving spouse’s gross estate will include

the value of the qualified terminable interest property. See

the instructions for Part 4—General Information, line 6, for

more details. The election is irrevocable.

Amendments to Regulations sections 20.2044-1,

20.2056(b)-7, and 20.2056(b)-10 clarify that an interest in

property is eligible for QTIP treatment if the income interest

is contingent upon the executor’s election even if that portion

of the property for which no election is made will pass to or

for the benefit of beneficiaries other than the surviving

spouse.

The marital deduction is not allowed for an interest that the

decedent directed the executor or a trustee to convert, after

death, into a terminable interest for the surviving spouse. The

marital deduction is not allowed for such an interest even if

there was no interest in the property passing to another

person and even if the terminable interest would otherwise

have been deductible under the exceptions described below

for life estate and life insurance and annuity payments with

powers of appointment. For more information, see

Regulations sections 20.2056(b)-1(f) and 20.2056(b)-1(g),

Example (7).

even though the interest will terminate on the wife’s death,

no one else will possess or enjoy any part of the property.

any other person to appoint any part to any person other

than the surviving spouse. If these five conditions are

satisfied only for a specific portion of the proceeds, see the

section 2056(b) regulations to determine the amount of the

marital deduction.

The QTIP election may be made for all or any part of

qualified terminable interest property. A partial election must

relate to a fractional or percentile share of the property so

that the elective part will reflect its proportionate share of the

increase or decline in the whole of the property when

applying section 2044 or 2519. Thus, if the interest of the

surviving spouse in a trust (or other property in which the

spouse has a qualified life estate) is qualified terminable
Form 706 (Rev. 8-2008)

Schedule M—Page 30

The determination of whether a trust qualifies as a QDOT

will be made as of the date the decedent’s Form 706 is filed.

If, however, judicial proceedings are brought before the Form

706’s due date (including extensions) to have the trust

revised to meet the QDOT requirements, then the

determination will not be made until the court-ordered

changes to the trust are made.

Line 3

The executor can elect out of QTIP treatment, however, by

checking the “Yes” box on line 3. Once made, the election

is irrevocable. If there is more than one such joint and

survivor annuity, you are not required to make the election

for all of them.

If you make the election out of QTIP treatment by checking

“Yes” on line 3, you cannot deduct the amount of the annuity

on Schedule M. If you do not make the election out, you

must list the joint and survivor annuities on Schedule M.

Listing Property Interests on Schedule M

Enter the value of each interest before taking into account

the federal estate tax or any other death tax. The valuation

dates used in determining the value of the gross estate apply

also on Schedule M.

If Schedule M includes a bequest of the residue or a part

of the residue of the decedent’s estate, attach a copy of the

computation showing how the value of the residue was

determined. Include a statement showing:

● The value of all property that is included in the decedent’s

gross estate (Schedules A through I) but is not a part of the

decedent’s probate estate, such as lifetime transfers, jointly

owned property that passed to the survivor on decedent’s

death, and the insurance payable to specific beneficiaries;

● The values of all specific and general legacies or devises,

with reference to the applicable clause or paragraph of the

decedent’s will or codicil. (If legacies are made to each

member of a class; for example, $1,000 to each of

decedent’s employees, only the number in each class and

the total value of property received by them need be

furnished);

● The date of birth of all persons, the length of whose lives

may affect the value of the residuary interest passing to the

surviving spouse; and

● Any other important information such as that relating to

any claim to any part of the estate not arising under the will.

Lines 5a, 5b, and 5c. The total of the values listed on

Schedule M must be reduced by the amount of the federal

estate tax, the federal GST tax, and the amount of state or

other death and GST taxes paid out of the property interest

involved. If you enter an amount for state or other death or

GST taxes on line 5b or 5c, identify the taxes and attach

your computation of them.

Attachments. If you list property interests passing by the

decedent’s will on Schedule M, attach a certified copy of the

order admitting the will to probate. If, when you file the

return, the court of probate jurisdiction has entered any

decree interpreting the will or any of its provisions affecting

any of the interests listed on Schedule M, or has entered any

order of distribution, attach a copy of the decree or order. In

addition, the IRS may request other evidence to support the

marital deduction claimed.

2. That requires that no distribution of corpus from the

trust can be made unless such a trustee has the right to

withhold from the distribution the tax imposed on the QDOT;

3. That meets the requirements of any applicable

regulations; and

4. For which the executor has made an election on the

estate tax return of the decedent.

You make the QDOT election simply by listing the qualified

domestic trust or the entire value of the trust property on

Schedule M and deducting its value. You are presumed to

have made the QDOT election if you list the trust or trust

property and deduct its value on Schedule M. Once made,

the election is irrevocable.

If an election is made to deduct qualified domestic trust

property under section 2056A(d), provide the following

information for each qualified domestic trust on an

attachment to this schedule:

Section 2056(b)(7) creates an automatic QTIP election for

certain joint and survivor annuities that are includible in the

estate under section 2039. To qualify, only the surviving

spouse can have the right to receive payments before the

death of the surviving spouse.

List each property interest included in the gross estate that

passes from the decedent to the surviving spouse and for

which a marital deduction is claimed. This includes otherwise

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

(including any clause or paragraph number) or provision of

law under which each item passed to the surviving spouse. If

possible, show where each item appears (number and

schedule) on Schedules A through I.

In listing otherwise nondeductible property for which you

are making a QTIP election, unless you specifically identify a

fractional portion of the trust or other property as not subject

to the election, the election will be considered made for all of

the trust or other property.

1. The name and address of every trustee;

2. A description of each transfer passing from the

decedent that is the source of the property to be placed in

trust; and

3. The employer identification number (EIN) for the trust.

The election must be made for an entire QDOT trust. In

listing a trust for which you are making a QDOT election,

unless you specifically identify the trust as not subject to the

election, the election will be considered made for the entire

trust.

Line 1

If property passes to the surviving spouse as the result of a

qualified disclaimer, check “Yes” and attach a copy of the

written disclaimer required by section 2518(b).

Note. For trusts created by an instrument executed before

November 5, 1990, paragraphs 1 and 2 above will be treated

as met if the trust instrument requires that all trustees be

individuals who are citizens of the United States or domestic

corporations.

A QDOT is any trust:

1. That requires at least one trustee to be either an

individual who is a citizen of the United States or a domestic

corporation;

interest property, you may make an election for a part of the

trust (or other property) only if the election relates to a

defined fraction or percentage of the entire trust (or other

property). The fraction or percentage may be defined by

means of a formula.

Qualified Domestic Trust Election (QDOT)

The marital deduction is allowed for transfers to a surviving

spouse who is not a U.S. citizen only if the property passes

to the surviving spouse in a qualified domestic trust (QDOT)

or if such property is transferred or irrevocably assigned to a

QDOT before the decedent’s estate tax return is filed.
Form 706 (Rev. 8-2008)

Estate of:

SCHEDULE O—Charitable, Public, and Similar Gifts and Bequests

Yes No

If the transfer was made by will, has any action been instituted to have interpreted or to contest the will or any

of its provisions affecting the charitable deductions claimed in this schedule?

1a

If ‘‘Yes,’’ full details must be submitted with this schedule.

b According to the information and belief of the person or persons filing this return, is any such action planned?

If ‘‘Yes,’’ full details must be submitted with this schedule.

2 Did any property pass to charity as the result of a qualified disclaimer?

If ‘‘Yes,’’ attach a copy of the written disclaimer required by section 2518(b).

Item

number Name and address of beneficiary Character of institution Amount

1

Total from continuation schedules (or additional sheets) attached to this schedule

3 Total 3

4a Federal estate tax payable out of property interests listed above 4a

b Other death taxes payable out of property interests listed above 4b

c Federal and state GST taxes payable out of property interests listed above 4c

d Add items 4a, 4b, and 4c 4d

5

Net value of property interests listed above (subtract 4d from 3). Also enter on Part 5—Recapitulation,

page 3, at item 21

5

(If more space is needed, attach the continuation schedule from the end of this package or additional sheets of the same size.)

(The instructions to Schedule O are in the separate instructions.)

Schedule O—Page 31

Decedent’s Social Security Number
Form 706 (Rev. 8-2008)

Estate of:

SCHEDULE P—Credit for Foreign Death Taxes

List all foreign countries to which death taxes have been paid and for which a credit is claimed on this return.

If a credit is claimed for death taxes paid to more than one foreign country, compute the credit for taxes paid to one country

on this sheet and attach a separate copy of Schedule P for each of the other countries.

The credit computed on this sheet is for the

(Name of death tax or taxes)

imposed in

(Name of country)

Credit is computed under the

(Insert title of treaty or “statute”)

Citizenship (nationality) of decedent at time of death

(All amounts and values must be entered in United States money.)

Total of estate, inheritance, legacy, and succession taxes imposed in the country named above attributable to

property situated in that country, subjected to these taxes, and included in the gross estate (as defined by statute)

1

2 Value of the gross estate (adjusted, if necessary, according to the instructions for item 2)

Value of property situated in that country, subjected to death taxes imposed in that country, and included in the

gross estate (adjusted, if necessary, according to the instructions for item 3)

3

4 Tax imposed by section 2001 reduced by the total credits claimed under sections 2010 and 2012 (see instructions)

Amount of federal estate tax attributable to property specified at item 3. (Divide item 3 by item 2 and multiply the

result by item 4.)

5

Credit for death taxes imposed in the country named above (the smaller of item 1 or item 5). Also enter on line

13 of Part 2—Tax Computation

6

SCHEDULE Q—Credit for Tax on Prior Transfers

Part 1. Transferor Information

IRS office where estate

tax return was filed Name of transferor Social security number Date of death

A

B

C

if section 2013(f) (special valuation of farm, etc., real property) adjustments to the computation of the credit were made (see

page 23 of the instructions).

Check here 

Part 2. Computation of Credit (see instructions on page 23)

Transferor Total

A, B, & C Item

A B C

1 Transferee’s tax as apportioned (from worksheet,

(line 7 line 8) x line 35 for each column)

2 Transferor’s tax (from each column of worksheet,

line 20)

3 Maximum amount before percentage requirement

(for each column, enter amount from line 1 or 2,

whichever is smaller)

4 Percentage allowed (each column) (see instructions) % % %

5 Credit allowable (line 3 x line 4 for each column)

TOTAL credit allowable (add columns A, B, and C

of line 5). Enter here and on line 14 of Part 2—Tax

Computation

6

Schedules P and Q—Page 32 (The instructions to Schedules P and Q are in the separate instructions.)

1

2

3

4

5

6

Decedent’s Social Security Number
Form 706 (Rev. 8-2008)

SCHEDULE R—Generation-Skipping Transfer Tax

Note. To avoid application of the deemed allocation rules, Form 706 and Schedule R should be filed to allocate the GST exemption

to trusts that may later have taxable terminations or distributions under section 2612 even if the form is not required to be filed

to report estate or GST tax.

Part 1. GST Exemption Reconciliation (Section 2631) and Section 2652(a)(3) (Special QTIP)

Election

You no longer need to check a box to make a section 2652(a)(3) (special QTIP) election. If you

list qualifying property in Part 1, line 9 below, you will be considered to have made this election.

See page 26 of the separate instructions for details.

1 Maximum allowable GST exemption 1

2 2 Total GST exemption allocated by the decedent against decedent’s lifetime transfers

3

Total GST exemption allocated by the executor, using Form 709, against decedent’s lifetime

transfers

3

4 GST exemption allocated on line 6 of Schedule R, Part 2 4

5 GST exemption allocated on line 6 of Schedule R, Part 3 5

6 Total GST exemption allocated on line 4 of Schedule(s) R-1 6

7 Total GST exemption allocated to inter vivos transfers and direct skips (add lines 2–6) 7

8

GST exemption available to allocate to trusts and section 2032A interests (subtract line 7 from

line 1)

8

9 Allocation of GST exemption to trusts (as defined for GST tax purposes):

A B C D E

Trust’s inclusion

ratio (optional—see

instructions)

Additional GST

exemption allocated

(see instructions)

GST exemption

allocated on lines 2–6,

above (see instructions)

Trust’s

EIN (if any)

Name of trust

9D Total. May not exceed line 8, above 9D

10 GST exemption available to allocate to section 2032A interests received by individual beneficiaries

(subtract line 9D from line 8). You must attach special-use allocation schedule (see instructions). 10

(The instructions to Schedule R are in the separate instructions.) Schedule R—Page 33

The GST tax is imposed on taxable transfers of interests in property located outside the United States as well as property

located inside the United States. (see the separate instructions beginning on page 23)
Form 706 (Rev. 8-2008)

Estate of:

Part 2. Direct Skips Where the Property Interests Transferred Bear the GST Tax on the

Direct Skips

Name of skip person Description of property interest transferred Estate tax value

1 Total estate tax values of all property interests listed above 1

2 Estate taxes, state death taxes, and other charges borne by the property interests listed above 2

GST taxes borne by the property interests listed above but imposed on direct skips other than

those shown on this Part 2 (see instructions)

3

3

4 Total fixed taxes and other charges (add lines 2 and 3) 4

5 Total tentative maximum direct skips (subtract line 4 from line 1) 5

6 GST exemption allocated 6

7 Subtract line 6 from line 5 7

8 GST tax due (divide line 7 by 3.222222) 8

9 Enter the amount from line 8 of Schedule R, Part 3 9

Total GST taxes payable by the estate (add lines 8 and 9). Enter here and on line 17 of

Part 2—Tax Computation, on page 1

10

10

Schedule R—Page 34

Decedent’s Social Security Number
Form 706 (Rev. 8-2008)

Estate of:

Part 3. Direct Skips Where the Property Interests Transferred Do Not Bear the

GST Tax on the Direct Skips

Name of skip person Description of property interest transferred Estate tax value

1 Total estate tax values of all property interests listed above 1

2 Estate taxes, state death taxes, and other charges borne by the property interests listed above 2

GST taxes borne by the property interests listed above but imposed on direct skips other than

those shown on this Part 3 (see instructions)

3

3

4 Total fixed taxes and other charges (add lines 2 and 3) 4

5 Total tentative maximum direct skips (subtract line 4 from line 1) 5

6 GST exemption allocated 6

7 Subtract line 6 from line 5 7

8 GST tax due (multiply line 7 by .45). Enter here and on Schedule R, Part 2, line 9 8

Schedule R—Page 35

Decedent’s Social Security Number
SCHEDULE R-1 Generation-Skipping Transfer Tax (Form 706) Direct Skips From a Trust OMB No. 1545-0015 (Rev. August 2008)

Department of the Treasury

Internal Revenue Service Payment Voucher

Executor: File one copy with Form 706 and send two copies to the fiduciary. Do not pay the tax shown. See the separate instructions.

Fiduciary: See instructions on the following page. Pay the tax shown on line 6.

Name of trust Trust’s EIN

Name and title of fiduciary Name of decedent

Address of fiduciary (number and street) Decedent’s SSN Service Center where Form 706 was filed

City, state, and ZIP code Name of executor

Address of executor (number and street) City, state, and ZIP code

Date of decedent’s death Filing due date of Schedule R, Form 706 (with extensions)

Part 1. Computation of the GST Tax on the Direct Skip

Description of property interests subject to the direct skip Estate tax value

1 1 Total estate tax value of all property interests listed above

2 Estate taxes, state death taxes, and other charges borne by the property interests listed above 2

3 3 Tentative maximum direct skip from trust (subtract line 2 from line 1)

4 GST exemption allocated 4

5 Subtract line 4 from line 3 5

GST tax due from fiduciary (divide line 5 by 3.222222). (See instructions if property will not

bear the GST tax.)

6

6

Under penalties of perjury, I declare that I have examined this return, including accompanying schedules and statements, and to the best of my knowledge and belief,

it is true, correct, and complete.

Signature(s) of executor(s)

Signature of fiduciary or officer representing fiduciary Date

Schedule R-1—Page 36

Date

Date
Form 706 (Rev. 8-2008)

Schedule R-1—Page 37

Instructions for the Trustee

Introduction Schedule R-1 (Form 706) serves as a payment voucher for the Generation-Skipping Transfer

(GST) tax imposed on a direct skip from a trust, which you, the trustee of the trust, must pay.

The executor completes the Schedule R-1 (Form 706) and gives you 2 copies. File one copy

and keep one for your records.

How to pay You can pay by check or money order.

● Make it payable to the “United States Treasury.”

● Make the check or money order for the amount on line 6 of Schedule R-1.

● Write “GST Tax” and the trust’s EIN on the check or money order.

Signature You must sign the Schedule R-1 in the space provided.

What to mail Mail your check or money order and the copy of Schedule R-1 that you signed.

Where to mail Mail to the Department of the Treasury, Internal Revenue Service Center, Cincinnati, OH 45999.

When to pay The GST tax is due and payable 9 months after the decedent’s date of death (shown on the

Schedule R-1). You will owe interest on any GST tax not paid by that date.

Automatic

extension

You have an automatic extension of time to file Schedule R-1 and pay the GST tax. The

automatic extension allows you to file and pay by 2 months after the due date (with

extensions) for filing the decedent’s Schedule R (shown on the Schedule R-1).

If you pay the GST tax under the automatic extension, you will be charged interest (but no

penalties).

Additional

information

For more information, see section 2603(a)(2) and the Instructions for Form 706, United States

Estate (and Generation-Skipping Transfer) Tax Return.
4

Form 706 (Rev. 8-2008)

Schedule U—Page 38

Estate tax value of the land subject to the qualified conservation easement (see separate

instructions)

Deduction under section 2055(f) for the conservation easement (see

separate instructions)

Amount of indebtedness on the land (see separate instructions)

Net value of land (subtract line 17 from line 4)

Value of qualified conservation easement for which the exclusion is

being claimed (see instructions)

Multiply line 12 by 2

Divide line 10 by line 8. Figure to 3 decimal places (for example,

“.123”)

Subtract line 11 from .300. Enter the answer in hundredths by rounding

any thousandths up to the next higher hundredth (that is, .030 = .03;

but .031 = .04)

Multiply line 18 by line 14

Subtract line 13 from .40

Enter the smaller of line 19 or the exclusion limitation (see instructions). Also enter this amount

on item 11, Part 5—Recapitulation, page 3

Part 3. Computation of Exclusion

10

11

12

6

14

15

16

5

13

7

8

9

17

1

SCHEDULE U—Qualified Conservation Easement Exclusion

Part 1. Election

Note. The executor is deemed to have made the election under section 2031(c)(6) if he or she files Schedule U and excludes any

qualifying conservation easements from the gross estate.

Part 2. General Qualifications

Describe the land subject to the qualified conservation easement (see separate instructions)

Estate of:

2 Did the decedent or a member of the decedent’s family own the land described above during the 3-year period ending

Yes No

3 Describe the conservation easement with regard to which the exclusion is being claimed (see separate instructions).

6

5

7

10

11

4

13

14

15

16

17

Value of retained development rights on the land (see instructions)

Subtract line 7 from line 6

18

19

20

8

9

12

18

19

20

Date of death value of any easements granted prior to decedent’s

death and included on line 10 below (see instructions)

Add lines 4 and 5

Multiply line 8 by 30% (.30)

Note. If line 10 is less than line 9, continue with line 11. If line 10

is equal to or more than line 9, skip lines 11 through 13, enter “.40”

on line 14, and complete the schedule.

Note. If line 11 is equal to or less than .100, stop here; the estate

does not qualify for the conservation easement exclusion.

Total reductions in value (add lines 7, 15, and 16)

Decedent’s Social Security Number

on the date of the decedent’s death?
Form 706 (Rev. 8-2008) (Make copies of this schedule before completing it if you will need more than one schedule.)

Estate of:

CONTINUATION SCHEDULE

Continuation of Schedule

(Enter letter of schedule you are continuing.)

Value at date of

death or amount

deductible

Alternate

valuation date

Description.

For securities, give CUSIP number.

If trust, partnership, or closely held entity, give EIN

Item

number

Unit value

(Sch. B, E, or G 

only)

Alternate value

TOTAL. (Carry forward to main schedule.)

Continuation Schedule—Page 39

See the instructions on the reverse side.

Decedent’s Social Security Number
Form 706 (Rev. 8-2008)

Instructions for Continuation Schedule

Continuation Schedule—Page 40

When you need to list more assets or deductions than you have room for on one of the main

schedules, use the Continuation Schedule on page 39. It provides a uniform format for listing

additional assets from Schedules A through I and additional deductions from Schedules J, K,

L, M, and O.

Please keep the following points in mind:

● Use a separate Continuation Schedule for each main schedule you are continuing. Do not

combine assets or deductions from different schedules on one Continuation Schedule.

● Make copies of the blank schedule before completing it if you expect to need more than

one.

● Use as many Continuation Schedules as needed to list all the assets or deductions.

● Enter the letter of the schedule you are continuing in the space at the top of the

Continuation Schedule.

● Use the Unit value column only if continuing Schedule B, E, or G. For all other schedules,

use this space to continue the description.

● Carry the total from the Continuation Schedules forward to the appropriate line on the main

schedule.

If continuing Report Where on Continuation

Schedule

Schedule E, Pt. 2 Percentage includible Alternate valuation date

Schedule K Amount unpaid to date Alternate valuation date

Schedule K Amount in contest Alternate value

Schedules J, L, M Description of deduction

continuation

Alternate valuation date and

Alternate value

Schedule O Character of institution Alternate valuation date and

Alternate value

Schedule O Amount of each deduction Amount deductible