Instructions For Form 706-Gs(T) - Internal Revenur Service printable pdf download

Instructions for

Department of the Treasury

Internal Revenue Service

Form 706-GS(T)

(Rev. February 2007)

Use with Form 706-GS(T) (Rev. February 2006)

Generation-Skipping Transfer Tax Return for Terminations

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Section references are to the Internal

Substantially separate and

When To File

independent shares of different

Revenue Code unless otherwise noted.

Generally, the trustee must file Form

beneficiaries in a trust.

706-GS(T) by April 15th of the year

If you are the trustee for separate

What’s New

following the calendar year in which the

trusts as described above, you must file

termination occurs. If the due date falls

a single Form 706-GS(T) but separate

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on a Saturday, Sunday, or legal

The trustee must file Form

Schedules A for each separate trust, as

holiday, file on the next business day.

706-GS(T) at the Cincinnati Service

that term is used here.

Center, regardless of whether the

If you are not able to file the return

Terminations Subject to

settlor is (or was at death) a resident

by the due date, you may request an

U.S. citizen, resident alien, nonresident

extension of time to file by filing Form

GST Tax

7004. The extension is automatic, so

U.S. citizen, or nonresident alien. See

you do not have to sign the form or

Where To File below for the address.

A termination may occur by reason of

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provide a reason for your request. You

death, lapse of time, release of a

You can request an automatic

must file Form 7004 on or before the

power, or any other means.

6-month extension of time to file Form

regular due date of Form 706-GS(T).

706-GS(T) by filing Form 7004,

In general, all taxable terminations

See Form 7004 for more information.

Application for Automatic 6-month

are subject to the GST tax. A taxable

Extension of Time To File Certain

termination is the termination of an

Where To File

interest in property held in trust unless:

Business Income Tax, Information, and

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File Form 706-GS(T) at the following

Immediately after the termination, a

Other Returns. Form 7004 replaces the

address:

non-skip person has an interest in the

use of Form 2758, Application for

property or

Extension of Time To File Certain

Internal Revenue Service Center

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At no time after the termination may

Excise, Income, Information, and Other

Cincinnati, OH 45999

a distribution be made from the trust to

Returns. For additional information, see

a skip person.

Trusts

Form 7004.

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The Pension Protection Act of 2006

Exceptions

Nonexplicit trusts. An arrangement

(PPA) has amended the provisions

that has substantially the same effect

Irrevocable trusts. Except as

used to determine substantial

as a trust will be treated as a trust even

described under Additions to

misstatements of valuation of property

though it is not an explicit trust.

irrevocable trusts on page 2, the GST

on returns filed after August 17, 2006.

Examples of such arrangements are

tax does not apply to any termination of

See Penalties and Interest on page 3

insurance and annuity contracts,

an interest in a trust that was

and section 6662(g) for more details.

arrangements involving life estates and

irrevocable on September 25, 1985.

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remainders, and estates for years.

The 5% credit for certain state

Any trust in existence on September

generation-skipping transfer (GST)

In general, a transfer of property in

25, 1985, will be considered irrevocable

taxes no longer applies to GST

which the identity of the transferee is

unless:

transfers made after December 31,

conditioned on the occurrence of an

1. On September 25, 1985, the

2004. For more information, see section

event is a transfer in trust. This rule

settlor held a power with respect to

2604.

does not apply to a testamentary trust,

such trust that would have caused the

however, if the event is to occur within

value of the trust to be included in the

6 months of the transferor’s date of

settlor’s gross estate for federal estate

General Instructions

death.

tax purposes by reason of section 2038

Nonexplicit trusts do not include

(regarding revocable transfers) if the

decedents’ estates.

settlor had died on September 25,

Purpose of Form

1985; or

In the case of a nonexplicit trust, the

Form 706-GS(T) is used by a trustee to

2. Regarding a policy of life

person in actual or constructive

figure and report the tax due from

insurance that is treated as a trust

possession of the property involved is

under section 2652(b), the insured

certain trust terminations that are

considered the trustee and is liable for

possessed an incident of ownership on

subject to the generation-skipping

filing Form 706-GS(T).

September 25, 1985, that would have

transfer (GST) tax.

If you are filing this return for a

caused the insurance proceeds to be

nonexplicit trust, see the instructions for

included in the insured’s gross estate

Who Must File

line 1b on page 3.

for federal estate tax purposes if the

In general, the trustee of any trust that

Separate trusts. You must treat as

insured had died on September 25,

has a taxable termination (defined on

separate trusts:

1985.

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this page) must file Form 706-GS(T) for

Portions of a trust that are

the tax year in which the termination

attributable to transfers from different

For more information, see

occurred.

transferors and

Regulations section 26.2601-1(b).

Cat. No. 10829R

Instructions For Form 706-Gs(T) - Internal Revenur Service

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