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Instructions for

Department of the Treasury

Internal Revenue Service

Form 706-GS(D)

(Rev. October 2008)

Generation-Skipping Transfer Tax Return for Distributions

automatic 6-month extension of time

provided by Notice 2007-54, 2007-27

Section references are to the Internal

Revenue Code unless otherwise noted.

to file by filing Form 7004. The

I.R.B. 12, tax return preparers, who

extension is automatic, so you do not

prepare any return or claim for refund

What’s New

have to sign the form or provide a

which reflects an understatement of

•

The Small Business and Work

reason for your request. You must file

tax liability due to willful or reckless

Opportunity Tax Act of 2007, P.L.

Form 7004 on or before the regular

conduct, are subject to a penalty of

100-28, extends the application of

due date of Form 706-GS(D). See

$5,000 or 50% of the income derived

return preparer penalties to all tax

Form 7004 for more information.

(or income to be derived), whichever

return preparers. See Penalties and

is greater, for the preparation of each

Where To File

Interest, Return preparer below for

such return. See section 6694; Notice

more information.

2008-11, 2008-3 I.R.B. 279; Notice

File Form 706-GS(D) at the following

2008-13, 2008-3 I.R.B. 282; and

address:

Notice 2008-46, 2008-18 I.R.B. 868

General Instructions

Department of the Treasury

for more details.

Internal Revenue Service Center

Cincinnati, OH 45999

Signature

Purpose of Form

Either the distributee or an authorized

Penalties and Interest

Form 706-GS(D) is used by a skip

representative must sign Form

person distributee to calculate and

Section 6651 provides penalties for

706-GS(D).

report the tax due on distributions

both late filing and late payment

from a trust that are subject to the

If you fill in your own return, leave

unless there is reasonable cause for

generation-skipping transfer (GST)

the Paid Preparer’s space blank. If

the delay. The law also provides

tax.

someone prepares your return and

penalties for willful attempts to evade

does not charge you, that person

payment of tax.

Who Must File

should not sign the return.

The late filing penalty will not be

In general, anyone who receives a

Generally, anyone who is paid to

imposed if the taxpayer can show that

taxable distribution from a trust must

prepare the return must sign the

the failure to file a timely return is due

file Form 706-GS(D). Trustees are

return in the space provided and fill in

to reasonable cause. Taxpayers filing

required to report taxable distributions

the Paid Preparer’s Use Only area.

late (after the due date, including

to skip person distributees on Form

See section 7701(a)(36)(B) for

extensions) should attach an

706-GS(D-1), Notification of

exceptions.

explanation to the return to show

Distribution From a Generation-

reasonable cause.

In addition to signing and

Skipping Trust.

completing the required information,

Section 6662 provides a penalty

Even if you receive a Form

the paid preparer must give a copy of

for underpayment of GST taxes which

706-GS(D-1), however, you do not

the completed return to the

exceed $5,000 that is attributable to

need to file Form 706-GS(D) if the

distributee.

valuation understatements. A

inclusion ratio found on Form

substantial valuation understatement

Note. A paid preparer may sign

706-GS(D-1), Part II, line 3, column d

occurs when the reported value of

original or amended returns by rubber

is zero for all distributions reported to

property listed on Form 706-GS(D) is

stamp, mechanical device, or

you. If you are required to file Form

65% or less of the actual value of the

computer software program.

706-GS(D), you do not have to

property.

include any distributions that have an

Interest will be charged on taxes

inclusion ratio of zero.

not paid by their due date, even if an

Specific Instructions

extension of time to file is granted.

When To File

Interest is also charged on any

Part I

The generation-skipping transfer tax

additions to tax imposed by section

on distributions is figured and

6651 from the due date of the return

Line 1a

reported on a calendar year basis,

(including any extensions) until the

regardless of your income tax

addition to tax is paid.

If the skip person distributee is a

accounting period. You must file

Return preparer. The Small

trust, enter the name of the trust here.

Form 706-GS(D) on or after January

Business and Work Opportunity Tax

1 but not later than April 15 of the

Line 1b

Act of 2007 (Act) extends the

year following the calendar year when

application of return preparer

For skip person distributees who are

the distributions were made.

penalties to all tax return preparers.

individuals, enter the distributee’s

If you are not able to file the return

Under section 6694, as amended by

social security number (SSN) here

by the due date, you may request an

the Act, and the transitional relief

and leave line 1c blank. If the skip

Cat. No. 10828G

Instructions For Form 706-Gs(D) - Department Of The Treasury Internal Revenue Service

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