Instructions For Form 706-Qdt - Department Of The Treasury printable pdf download

Instructions for

Department of the Treasury

Internal Revenue Service

Form 706-QDT

(Rev. February 2007)

U.S. Estate Tax Return for Qualified Domestic Trusts

•

Section references are to the Internal

The trust instrument requires that no

Who Must File

distribution of corpus from the trust may

Revenue Code unless otherwise noted.

Either the trustee or the designated

be made unless that trustee has the

filer, as described below, must file Form

right to withhold from the distribution

What’s New

706-QDT for any year in which the

the QDOT tax imposed on the

QDOT has a taxable event (defined

distribution,

•

The trustee or designated filer must

below) or makes a distribution on

The QDOT election under section

now file Form 706-QDT at the

account of hardship.

2056A(d) has been made for the trust

Cincinnati Service Center, regardless of

by the executor of the estate on the

Trustee

whether the estate of the decedent

decedent’s estate tax return, and

•

(grantor of the QDOT) filed a Form 706,

If the surviving spouse is the

The requirements of all applicable

U.S. Estate (and Generation-Skipping

beneficiary of only one QDOT, the

regulations have been met.

Transfer) Tax Return; or a Form

trustee of that QDOT is liable for filing

Taxable event. A taxable event is any

706-NA, U.S. Estate (and

Form 706-QDT and paying the tax.

of the following:

Generation-Skipping Transfer) Tax

The trustee must also file Form

1. Any distribution from a QDOT

Return, Estate of nonresident not a

706-QDT if the surviving spouse is the

(and certain annuity payments) before

citizen of the United States. See Where

beneficiary of more than one QDOT,

the death of the surviving spouse,

To File on page 2 for the address.

unless the decedent’s executor

except:

•

You can apply for an automatic

designated one U.S. trustee as the

a. Distributions of income to the

6-month extension of time to file Form

designated filer.

surviving spouse, and

706-QDT by filing Form 4768,

If there is more than one trustee for

b. Any distributions made to the

Application for Extension of Time To

any single trust, each trustee is liable

surviving spouse on account of

File a Return and/or Pay U.S. Estate

for filing the return and paying the tax.

hardship;

(and Generation-Skipping Transfer)

2. The death of the surviving

If there is a designated filer, the

Taxes. When asking for an automatic

spouse; and

trustee must still complete a separate

6-month extension, you are not

Schedule B of Form 706-QDT for each

3. The failure of the trust to qualify

required to provide an explanation for

as a QDOT.

trust for which he or she is the trustee

your request. See Form 4768 for more

and provide the completed Schedule B

details.

Hardship distribution. A distribution

to the designated filer at least 60 days

of principal is treated as made on

before the due date for filing Form

account of hardship if it is made to the

706-QDT.

spouse from the QDOT in response to

General Instructions

Designated Filer

an immediate and substantial financial

need relating to the spouse’s health,

If the surviving spouse is the

maintenance, education, or support, or

Purpose of Form

beneficiary of more than one QDOT

the health, maintenance, education, or

from a single decedent, and the

The trustee or designated filer

support of any person that the surviving

decedent’s executor has made such a

(described below) of a qualified

spouse is legally obligated to support.

designation, then the designated filer

domestic trust (QDOT) uses Form

Decedent. In these instructions,

selected by the executor is liable for

706-QDT to figure and report the estate

decedent means the grantor of the

filing the return and paying the tax for

tax due on:

QDOT on whose estate tax return the

all QDOTs. This designation can be

•

Certain distributions from the QDOT,

executor makes the QDOT election.

made on either the decedent’s estate

•

The value of the property remaining

tax return or the first Form 706-QDT

Surviving spouse. In these

in the QDOT on the date of the

that is timely filed.

instructions, surviving spouse means

surviving spouse’s death, and

the individual who is both the surviving

•

In this case, the trustee of each

The corpus portion of certain annuity

spouse of the decedent and also the

QDOT is responsible for completing

payments.

beneficiary of the decedent’s QDOT.

Schedule B of Form 706-QDT for his

Under certain circumstances, the

or her trust and giving it to the

When To File

trustee/designated filer uses Form

designated filer.

706-QDT to notify the IRS that the trust

Form 706-QDT is an annual return.

Definitions

is exempt from future filing because the

Generally, the return to report

surviving spouse has become a U.S.

distributions is due on or after January

Qualified domestic trust. A qualified

citizen and meets the requirements

1 but not later than April 15 of the year

domestic trust is any trust that qualifies

listed under Line 4. Spousal Election on

following any calendar year in which a

for an estate tax marital deduction

page 4.

taxable event occurred or a distribution

under section 2056 and also meets all

was made on account of hardship.

The qualified domestic trust rules

of the following requirements.

•

apply only in those situations where a

The trust instrument requires that at

However, if you are filing the return

decedent’s surviving spouse is not a

least one trustee be either a U.S.

because of the death of the surviving

U.S. citizen.

citizen or a domestic corporation,

spouse, you must file it within 9 months

Cat. No. 12384F

Instructions For Form 706-Qdt - Department Of The Treasury

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