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Penalties

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is a U.S. citizen, then only half the

value of property held by the decedent

The law provides for penalties for both

706-NA

and surviving spouse either as joint

late filing of returns and late payment of

tenants with right of survivorship or as

First, enter the decedent’s name and

tax unless there is reasonable cause

tenants by the entirety). For exceptions,

the other information called for in Part I.

for the delay. There are also penalties

see the instructions on the reverse side

For item 2, enter the decedent’s social

for willful attempts to evade or defeat

of Schedule E, Form 706;

security number (SSN) or individual

•

payment of tax.

Property the decedent and a

taxpayer identification number (ITIN),

surviving spouse owned as community

whichever is applicable. Then answer

The law also provides for penalties

property to the extent of the decedent’s

all of the questions in Part III.

for valuation understatements that

interest in the property under applicable

The estate tax is imposed on the

cause an underpayment of tax. See

state, possession, or foreign law;

sections 6662(g) and (h) for more

decedent’s gross estate in the United

•

A surviving spouse’s dower or

States, reduced by allowable

details.

curtesy interest and all substitute

deductions. Compute the gross estate

interests created by statute;

in the United States on Schedule A.

•

Death Tax Treaties

Proceeds of insurance on the

Reduce the Schedule A total by the

decedent’s life, generally including

Death tax treaties are in effect with the

allowable deductions to derive the

proceeds receivable by beneficiaries

following countries:

taxable estate on Schedule B, and

other than the estate;

figure the tax due using the Tax

•

Several kinds of transfers the

Australia

Italy

Computation schedule (Part II).

decedent made before death;

Austria

Japan

•

Property in which the decedent either

Part III. General Information

Canada*

Netherlands

held a general power of appointment at

Denmark

Norway

Question 6a. If you answer “Yes,”

the time of death, or used or released

Finland

South Africa

please attach a statement listing:

this power in certain ways before

France

Sweden

•

The citizenship of the decedent’s

death; and

Germany

Switzerland

•

parents,

Certain annuities to surviving

Greece

United Kingdom

•

Whether the decedent became a

beneficiaries.

Ireland

U.S. citizen through a naturalization

*Article XXIX B of the United States — Canada

For additional information

proceeding in the United States, and

•

Income Tax Treaty

concerning joint tenancies, tenancies

When the decedent lost U.S.

by the entirety, annuities, life insurance,

citizenship or residency.

transfers during life, and powers of

If you are reporting any items on this

Question 6b. If you answer “Yes,” but

return based on the provisions of a

appointment, see the Instructions for

maintain that avoiding U.S. taxes was

death tax treaty or protocol, you may

Form 706.

not a principal purpose for the

have to attach a statement to this return

decedent’s loss of citizenship or

Enter on Schedule A all of the assets

disclosing the return position that is

residency, attach documents to sustain

that meet both the following tests.

treaty based. See Regulations section

•

your position. See Definitions on

They are included in the entire gross

301.6114-1 for details.

page 1.

estate and

•

Question 9. A general power of

They are located in the United

States. (See Determining where assets

appointment means any power of

appointment exercisable in favor of the

are located below.)

Specific Instructions

decedent, the decedent’s estate, the

Determining where assets are

decedent’s creditors, or the creditors of

located. Unless a treaty provides

Attachments

the decedent’s estate, and includes the

otherwise (see Death Tax Treaties

right of a beneficiary to appropriate or

If the decedent died testate, attach a

above), use the following rules to

consume the principal of a trust. For a

certified copy of the will to Form

determine whether assets are located

complete definition, see section 2041.

706-NA. If you are unable to obtain a

in the United States.

certified copy, attach a copy of the will

Schedule A

Real estate and tangible personal

and explain why it could not be

Before you complete Schedule A, you

property. Real estate and tangible

certified.

must determine what assets are

personal property are located in the

included in the decedent’s entire gross

United States, if they are physically

You must also attach a copy of the

estate, wherever located. However, list

located there.

decedent’s death certificate.

on Schedule A only those assets

Note. An exception is made for works

included in the entire gross estate that

For closely held or inactive corporate

of art, which are owned by a

are located in the United States. Enter

stock, attach the balance sheets,

nonresident alien (NA) and are located

the total value of assets located outside

particularly the one nearest the

within the United States, if on the date

the United States on line 2 of

valuation date, and statements of the

of death (of the NA-owner), the works

Schedule B.

net earnings or operating results and

of art are:

•

dividends paid for each of the 5

Entire gross estate. The entire gross

Imported solely for public exhibition,

•

preceding years. Attach any other

estate is figured the same way for a

On loan to a non-profit public gallery

documents, such as appraisal lists,

nonresident alien decedent as for a

or museum, and

•

U.S. citizen or resident. It consists of all

needed for explanation. Also attach

On exhibition or en route to or from

property the decedent beneficially

copies of all available U.S. gift tax

exhibition.

returns the decedent filed. Other

owned, wherever located, and includes

the following property interests.

Stock. Generally, no matter where

documents may be required as

•

Generally, the full value of property

stock certificates are physically located,

explained in these instructions.

the decedent owned at the time of

stock of corporations organized in or

Attach an English translation to all

death as a joint tenant with right of

under U.S. law is properly located in

documents in other languages.

survivorship (but if the surviving spouse

the United States, and all other

-2-

Instructions For Form 706-Na - United States Estate (And Generation-Skipping Transfer) Tax Return - Internal Revenue Service - 2006 Page 2

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