Instructions For Form Mn-706 - Minnesota Estate Tax (Page 4 of 6) in pdf

Required information

for late filing of the return and/or late

no later than 180 days after you are

payment of the tax. Adding penalties

notified of the changes or corrections to

You must attach the following items to

together can result in a total penalty of

the decedent’s federal estate tax return.

Form MN-706:

as much as 88 percent of the tax due.

You must file an amended Minnesota

• a copy of the signed federal Form 706

(M.S. 289A.60)

return even if the changes or corrections

filed by the estate with the IRS,

Criminal penalties. If you willfully fail to

made by the IRS do not require that an

• copies of all federal schedules (A

file a return in order to evade paying the

amended federal return be filed. How-

through U), and

tax, you could be charged with a gross

ever, if an amended federal return is

• a copy of the death certificate.

misdemeanor. If you file a fraudulent

filed, you must attach a copy to the

Do not attach copies of the appraisals,

return in order to evade paying all or

amended Minnesota estate tax return.

trust agreements, wills, etc., that you

part of the tax, you could be charged

To file an amended Minnesota estate tax

attached to the estate’s federal Form 706.

with a felony. (M.S. 289A.63)

return, fill out a new Form MN-706 with

(M.S. 289A.10)

Failure to report federal changes. A

the appropriate amended information

Other items you may be required to

penalty of 10 percent on any additional

and check the box at the top of the form

attach to Form MN-706 include:

tax will be assessed if you fail to file an

to indicate that it is an amended return.

amended Minnesota return or report the

• a copy of the IRS’s extension approval

If there are no changes made to the

federal changes within 180 days after

if you are filing the Minnesota estate

federal return, the IRS will generally

you were notified of the federal changes.

tax return by the federal extended

issue the estate an “Estate Tax Closing

(M.S. 289A.60, subd. 24)

due date.

Letter.” If you received a closing letter,

• a copy of another state’s tax return

submit a copy to the Minnesota Depart-

Abatement of penalties

and cancelled check showing payment

ment of Revenue so the estate’s file can

of the tax or a payment receipt issued

If you were not able to timely file the

be closed.

by the other state if you paid estate

return or timely pay the estate tax

(M.S. 289A.38, subd. 7)

tax or inheritance tax to another state.

because of a reasonable cause, write a

If you fail to report the federal changes

letter to the Commissioner of Revenue

• an itemized list of the gross values of

within 180 days as required, a 10 percent

explaining the circumstances. The

the decedent’s real and tangible

penalty of any additional tax will be

Commissioner will study your explana-

personal property located outside

assessed.

tion and will respond with a letter

Minnesota (if a resident estate) or in

(M.S. 289A.60, subd. 24)

stating whether or not the estate will

Minnesota (if a nonresident estate).

have to pay the late filing or late pay-

Also include a list of the schedule and

Refund of Minnesota

ment penalty.

item number where each property is

estate tax

listed in the decedent’s federal estate

Your abatement request must be made

tax return.

within 60 days after the date you were

If the tax has been overpaid, or if the

notified that a penalty has been imposed.

• a completed PV47 payment voucher if

circumstances of the estate have changed

(M.S. 270.07, subd. 1)

you are paying estate tax due when

since the Minnesota return was filed and

filing Form MN-706.

you believe all or a portion of the tax

Interest

already paid should be refunded, fill out

• a copy of the IRS approval document

a new Form MN-706 and check the box

if you are paying the federal estate tax

Interest is calculated as simple interest

to show it is an amended return. Be sure

in installments.

and accrues on any unpaid estate tax

to fill in on line 14 the amount of tax,

and penalties beginning nine months

penalty and interest already paid, if any.

Use of information

from the decedent’s date of death.

On line 19 fill in the amount of refund.

Interest will be charged even if the

All information you fill in on the return

deadline for filing the return has been

The estate will be paid interest on the

is guaranteed private by state law. It

extended or the tax is being paid under

amount refunded.

cannot be given to others without your

an installment plan. The rate of interest

(M.S. 289A.50)

consent except to the IRS, to other

may change from year to year.

Minnesota state agencies that guarantee

(M.S. 270.75)

Income tax return

its privacy, and to other state govern-

ments that guarantee the same privacy

Rates in effect for recent years are:

for estates

by state law.

1988 . . . . . . . . . . . . . . . . . . . 8 percent

If the estate’s assets generate $600 or

1989 . . . . . . . . . . . . . . . . . . . 9 percent

more of Minnesota gross income, Form

Changes to the federal

1990 . . . . . . . . . . . . . . . . . . 11 percent

M-2, Fiduciary Income Tax Return, must

1991 . . . . . . . . . . . . . . . . . . 10 percent

estate tax return

be filed with Minnesota.

1992 . . . . . . . . . . . . . . . . . . . 9 percent

If the IRS makes changes to or corrects

Form M-2 corresponds to the federal

1993 and 1994 . . . . . . . . . . 6 percent

the decedent’s federal estate tax return

Form 1041, United States Income Tax

1995 . . . . . . . . . . . . . . . . . . . 7 percent

and the adjustments result in a change to

Return for Estates and Trusts.

1996 . . . . . . . . . . . . . . . . . . . 9 percent

the credit for state death taxes, you must

1997 . . . . . . . . . . . . . . . . . . . 8 percent

file an amended Minnesota return. The

1998 . . . . . . . . . . . . . . . . . . . 9 percent

amended Minnesota return must be filed

1999 and 2000 . . . . . . . . . . 8 percent

2001 . . . . . . . . . . . . . . . . . . . 9 percent

(M.S. 289A.55)

Instructions For Form Mn-706 - Minnesota Estate Tax Page 4

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