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Gifts made to third parties that are to

Schedule C. Computation of GST Tax

Column G. Split Gifts

be split with your spouse,

beginning on page 10.

Enter an amount in this column only if you

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Charitable gifts (if you are not splitting

have chosen to split gifts with your

Column D. Donor’s Adjusted Basis

gifts with your spouse), and

spouse.

of Gifts

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Other gifts.

Show the basis you would use for income

Split Gifts—Gifts Made by

If a transfer results in gifts to two or more

tax purposes if the gift were sold or

individuals (such as a life estate to one

Spouse

exchanged. Generally, this means cost

with remainder to the other), list the gift to

If you elected to split gifts with your

plus improvements, less applicable

each separately.

spouse and your spouse has given a

depreciation, amortization, and depletion.

Number and describe all gifts

gift(s) that is being split with you, enter in

For more information on adjusted

(including charitable, public, and similar

this area of Part 1 information on the

basis, see Pub. 551, Basis of Assets.

gifts) in the columns provided in

gift(s) made by your spouse. If only you

Schedule A.

Columns E and F. Date and Value

made gifts and your are splitting them

with your spouse, do not make an entry in

of Gift

Column B

this area.

The value of a gift is the fair market value

Describe each gift in enough detail so that

of the property on the date the gift is

Generally, if you elect to split your

the property can be easily identified, as

made. The fair market value is the price

gifts, you must split all gifts made by you

explained below.

at which the property would change

and your spouse to third-party donees.

For real estate, give:

hands between a willing buyer and a

The only exception is if you gave your

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A legal description of each parcel;

willing seller, when neither is forced to

spouse a general power of appointment

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The street number, name, and area if

buy or to sell, and when both have

over a gift you made.

the property is located in a city; and

reasonable knowledge of all relevant

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Supplemental Documents

A short statement of any improvements

facts. Fair market value may not be

made to the property.

determined by a forced sale price, nor by

To support the value of your gifts, you

the sale price of the item in a market

must provide information showing how it

For bonds, give:

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other than that in which the item is most

was determined.

The number of bonds transferred;

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commonly sold to the public. The location

The principal amount of each bond;

For stock of close corporations or

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of the item must be taken into account

Name of obligor;

inactive stock, attach balance sheets,

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whenever appropriate.

Date of maturity;

particularly the one nearest the date of

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The fair market value of a stock or

Rate of interest;

the gift, and statements of net earnings or

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bond (whether listed or unlisted) is the

Date or dates when interest is payable;

operating results and dividends paid for

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mean between the highest and lowest

Series number, if there is more than

each of the 5 preceding years.

selling prices quoted on the valuation

one issue;

For each life insurance policy, attach

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date. If only the closing selling prices are

Exchanges where listed or, if unlisted,

Form 712, Life Insurance Statement.

available, then the fair market value is the

give the location of the principal business

mean between the quoted closing selling

office of the corporation; and

Note for single premium or paid-up

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price on the valuation date and on the

policies. In certain situations, for

CUSIP number. The CUSIP number is

trading day before the valuation date. To

example, where the surrender value of

a nine-digit number assigned by the

figure the fair market value if there were

the policy exceeds its replacement cost,

American Banking Association to traded

no sales on the valuation date, see the

the true economic value of the policy will

securities.

instructions for Schedule B of Form 706.

be greater than the amount shown on line

For stocks:

59 of Form 712. In these situations, report

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Stock of close corporations or inactive

Give number of shares;

the full economic value of the policy on

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stock must be valued on the basis of net

State whether common or preferred;

Schedule A. See Rev. Rul. 78-137,

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worth, earnings, earning and dividend

If preferred, give the issue, par value,

1978-1 C.B. 280 for details.

capacity, and other relevant factors.

quotation at which returned, and exact

Generally, the best indication of the

name of corporation;

If the gift was made by means of a

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value of real property is the price paid for

If unlisted on a principal exchange, give

trust, attach a certified or verified copy of

the property in an arm’s-length

the location of the principal business

the trust instrument to the return on which

transaction on or before the valuation

office of the corporation, the state in

you report your first transfer to the trust.

date. If there has been no such

which incorporated, and the date of

However, to report subsequent transfers

transaction, use the comparable sales

incorporation;

to the trust, you may attach a brief

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method. In comparing similar properties,

If listed, give principal exchange; and

description of the terms of the trust or a

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consider differences in the date of the

CUSIP number.

copy of the trust instrument.

sale, and the size, condition, and location

For interests in property based on the

Also attach any appraisal used to

of the properties, and make all

length of a person’s life, give the date of

determine the value of real estate or

appropriate adjustments.

birth of the person. If you transfer any

other property.

The value of all annuities, life estates,

interest in a closely held entity, provide

If you do not attach this information,

terms for years, remainders, or reversions

the EIN of the entity.

you must include in Schedule A full

is generally the present value on the date

For life insurance policies, give the

information to explain how the value was

of the gift.

name of the insurer and the policy

determined.

Sections 2701 and 2702 provide

number.

special valuation rules to determine the

Part 2—Direct Skips

Clearly identify in the description

amount of the gift when a donor transfers

List in Part 2 only those gifts that are

column which gifts create the opening of

an equity interest in a corporation or

currently subject to both the gift and GST

an ETIP as described under Transfers

partnership (section 2701) or makes a gift

taxes. You must list the gifts in Part 2 in

Subject to an Estate Tax Inclusion Period

in trust (section 2702). The rules only

the chronological order that you made

(ETIP) on page 3. Describe the interest

apply if, immediately after the transfer, the

them. Number, describe, and value the

that is creating the ETIP. An allocation of

donor (or an applicable family member)

gifts as described in the instructions for

GST exemption to property subject to an

holds an applicable retained interest in

Part 1 on page 7.

ETIP that is made prior to the close of the

the corporation or partnership, or retains

ETIP becomes effective no earlier than

an interest in the trust. For details, see

If you made a transfer to a trust that

the date of the close of the ETIP. See the

sections 2701 and 2702, and their

was a direct skip, list the entire gift as one

instructions for Schedule C under

regulations.

line entry in Part 2.

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Instructions For Form 709 - United States Gift (And Generation-Skipping Transfer) Tax Return - 2006 Page 8

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