Form 706 (Draft) - United States Estate (And Generation-Skipping Transfer) Tax Return - 2016 Page 27
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55worth. Full value of jointly-owned
Any interest in an Archer medical
Valuation discounts. If you
property also does not have to be
answered “Yes,” to Part 4—General
savings account (MSA) or health
included in the gross estate if you can
Information, line 11b for any interest in a
savings account (HSA), unless such
show that any part of the property was
partnership, an unincorporated
interest passes to the surviving spouse;
acquired with consideration originally
business, a limited liability company, or
and
belonging to the surviving joint tenant or
stock in a closely-held corporation,
Insurance on the life of another
tenants. In this case, you may exclude
attach a statement that lists the item
(obtain and attach Form 712, for each
from the value of the property an
number from Schedule F and identifies
policy).
DRAFT AS OF
amount proportionate to the
the total effective discount taken (that is,
Note (for single premium or paid-up
consideration furnished by the other
XX.XX%) on such interest.
policies). In certain situations (for
tenant or tenants. Relinquishing or
example, where the surrender value of
promising to relinquish dower, curtesy,
Example of effective discount:
the policy exceeds its replacement
or statutory estate created instead of
cost), the true economic value of the
dower or curtesy, or other marital rights
a Pro-rata value of limited liability
June 16, 2016
policy will be greater than the amount
in the decedent's property or estate is
company (before any discounts)
$100.00
shown on line 59 of Form 712. In these
not consideration in money or money's
situations, report the full economic value
b Minus: 10% discounts for lack of
worth. See the Schedule A instructions
control
(10.00)
of the policy on Schedule F. See Rev.
for the value to show for real property
Rul. 78-137, 1978-1 C.B. 280 for details.
that is subject to a mortgage.
c Marketable minority interest value
(as if freely traded minority interest
If the property was acquired by the
Section 2044 property (see Decedent
value)
$90.00
decedent and another person or
Who Was a Surviving Spouse, later);
persons by gift, bequest, devise, or
d Minus: 15% discount for lack of
Claims (including the value of the
marketability
(13.50)
inheritance as joint tenants, and their
decedent's interest in a claim for refund
interests are not otherwise specified by
e Non-marketable minority interest
of income taxes or the amount of the
law, include only that part of the value of
value
$76.50
refund actually received);
the property that is figured by dividing
Rights;
the full value of the property by the
Royalties;
Calculation of effective discount:
number of joint tenants.
Leaseholds;
If you believe that less than the full
Judgments;
(a minus e) divided by a = effective discount
value of the entire property is includible
Reversionary or remainder interests;
in the gross estate for tax purposes, you
($100.00 - $76.50) ÷ $100.00 = 23.50%
Shares in trust funds (attach a copy of
must establish the right to include the
the trust instrument);
smaller value by attaching proof of the
Note. The amount of discounts are
Household goods and personal
extent, origin, and nature of the
based on the factors pertaining to a
effects, including wearing apparel;
decedent's interest and the interest(s) of
specific interest and those discounts
Farm products and growing crops;
the decedent's co-tenant or co-tenants.
shown in the example are for
Livestock;
demonstration purposes only.
In the “Includible alternate value” and
Farm machinery; and
“Includible value at date of death”
Automobiles.
If you answered “Yes,” to line 11b for
columns, enter only the values that you
any transfer(s) described in (1) through
Interests. If the decedent owned any
believe are includible in the gross
(5) in the Schedule G instructions (and
interest in a partnership or
estate.
made by the decedent), attach a
unincorporated business, attach a
statement to Schedule G which lists
Schedule F—Other
statement of assets and liabilities for the
the item number from that schedule and
valuation date and for the 5 years before
Miscellaneous Property
identifies the total effective discount
the valuation date. Also, attach
taken (that is, XX.XX%) on such
statements of the net earnings for the
If any assets to which the
transfer(s).
same 5 years. Be sure to include the
special rule of Regulations
!
EIN of the entity. You must account for
Line 1. If the decedent owned at the
section 20.2010-2(a)(7)(ii)
CAUTION
goodwill in the valuation. In general,
date of death works of art or items with
applies are reported on this schedule,
furnish the same information and follow
collectible value (for example, jewelry,
do not enter any value in the last three
the methods used to value close
furs, silverware, books, statuary, vases,
columns. See instructions for line 10 of
corporations. See the instructions for
oriental rugs, coin or stamp collections),
Part 5–Recapitulation for information on
Schedule B.
check the “Yes,” box on line 1 and
how to estimate and report the value of
provide full details. If any item or
these assets.
All partnership interests should be
collection of similar items is valued at
reported on Schedule F unless the
You must complete Schedule F
more than $3,000, attach an appraisal
partnership interest, itself, is
by an expert under oath and the
and file it with the return.
jointly-owned. Jointly-owned
required statement regarding the
partnership interests should be reported
On Schedule F, list all items that must
appraiser's qualifications (see
on Schedule E.
be included in the gross estate that are
Regulations section 20.2031-6(b)).
If real estate is owned by a sole
not reported on any other schedule,
proprietorship, it should be reported on
including:
Decedent Who Was a
Schedule F and not on Schedule A.
Debts due the decedent (other than
Surviving Spouse
Describe the real estate with the same
notes and mortgages included on
detail required for Schedule A.
If the decedent was a surviving spouse,
Schedule C);
he or she may have received qualified
Interests in business;
-26-
Part Instructions
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