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should attach an explanation to the return

Department of the Treasury

to show reasonable cause.

Section 6662 provides a penalty for

Internal Revenue Service

underpayment of GST taxes of $5,000 or

more that is attributable to valuation

Instructions for Form

understatements. A valuation

understatement occurs when the reported

value of property listed on Form 706-GS(D)

706-GS(D)

is 50% or less of the actual value of the

property.

Interest will be charged on taxes not

(Rev. March 1995)

paid by their due date, even if an

extension of time to file is granted. Interest

is also charged on any additions to tax

Generation-Skipping Transfer Tax Return for

imposed by section 6651 from the due

date of the return (including any

Distributions

extensions) until the addition to tax is paid.

Section references are to the Internal Revenue Code unless otherwise noted.

Signature

Paperwork Reduction Act Notice.—We ask for the information on this form to carry out

Either the distributee or an authorized

the Internal Revenue laws of the United States. You are required to give us the

representative must sign Form 706-GS(D).

information. We need it to ensure that you are complying with these laws and to allow us

If you fill in your own return, leave the

to figure and collect the right amount of tax.

Paid Preparer’s space blank. If someone

The time needed to complete and file this form will vary depending on individual

prepares your return and does not charge

circumstances. The estimated average time is:

you, that person should not sign the return.

Copying,

Generally, anyone who is paid to prepare

Learning about

assembling, and

your return must sign it and fill in the other

the law or the

Preparing

sending the form to

blanks in the Paid Preparer’s Use Only

Recordkeeping

form

the form

the IRS

area of the return.

7 min.

12 min.

24 min.

19 min.

Specific Instructions

If you have comments concerning the accuracy of these time estimates or suggestions

for making this form simpler, we would be happy to hear from you. You can write to the

Part I

Internal Revenue Service, Attention: Tax Forms Committee, PC:FP, Washington, DC

20224. DO NOT send the form to this address. Instead, see Where To File below.

Line 1a

If the skip person distributee is a trust,

Item To Note

When To File

enter the name of the trust here.

You might be able to deduct on your Form

The generation-skipping transfer tax on

Line 1b

1040 the generation-skipping transfer tax

distributions is figured and reported on a

For skip person distributees who are

you pay with this form. See the

calendar year basis, regardless of your

individuals, enter the distributee’s social

instructions for Part III, line 11, on page 2

income tax accounting period. You must

security number (SSN) here and leave line

for details.

file Form 706-GS(D) on or after January 1

1c blank. If the skip person distributee is a

but not later than April 15 of the year

trust, see the instructions for line 1c. DO

following the calendar year when the

General Instructions

NOT enter a number on both line 1b and

distributions were made.

line 1c.

If you are not able to file the return by

Purpose of Form

Line 1c

the due date, you may request an

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

extension of time to file by filing Form

If the skip person distributee is a trust,

distributee to calculate and report the tax

2758, Application for Extension of Time To

enter the trust’s employer identification

due on distributions from a trust that are

File Certain Excise, Income, Information,

number (EIN) and leave line 1b blank. DO

subject to the generation-skipping transfer

and Other Returns. This does not provide

NOT enter a number on both line 1b and

(GST) tax.

for an automatic extension, so be sure to

line 1c.

file Form 2758 in adequate time to allow

Who Must File

Line 2a

the IRS to consider the application and to

reply before the return’s regular due date.

In general, anyone who receives a taxable

If the skip person distributee is a trust,

enter the trustee’s name here. If the skip

distribution from a trust must file Form

Where To File

706-GS(D). Trustees are required to report

person distributee is a minor or is under

some disability that precludes the

taxable distributions to skip person

File Form 706-GS(D) at the Internal

distributees on Form 706-GS(D-1),

individual from filing the return, enter the

Revenue Service Center specified on your

name of the person who is legally

Notification of Distribution From a

copy of Form 706-GS(D-1).

Generation-Skipping Trust.

responsible for conducting the affairs of

the distributee, such as a parent or

Penalties and Interest

Even if you receive a Form 706-GS(D-1),

guardian. Also, include the title or

however, you do not need to file Form

Section 6651 provides penalties for both

relationship to the distributee.

706-GS(D) if the inclusion ratio found in

late filing and late payment unless there is

Part II, line 3, column d, of Form

Line 2b

reasonable cause for the delay. The law

706-GS(D-1) is zero for ALL distributions

also provides penalties for willful attempts

Enter the address at which you wish to

reported to you. If you are required to file

to evade payment of tax.

receive correspondence from the IRS

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

The late filing penalty will not be

regarding this return. If there is an entry on

include any distributions that have an

imposed if the taxpayer can show that the

line 2a, the address entered here will

inclusion ratio of zero.

failure to file a timely return is due to

normally be that of the person listed on

reasonable cause. Taxpayers filing late

line 2a, rather than the individual or trust

(after the due date, including extensions)

listed on line 1a.

Cat. No. 10828G

Instructions For Form 706-Gs(D) - Generation-Skipping Transfer Tax Return For Distributions

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