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is less than the amount of all taxable gifts

Entry spaces with gray shading

line 5 and on line 7 of Part 2—Tax

for the year ($5 million), A expended all $4

and columns and lines marked

Computation.

million of his available applicable

“Reserved” are inactive. Do not

CAUTION

exclusion on all taxable gifts during the

enter any information in these areas.

Schedule D. Computation

year.

of GST Tax

Schedule C requests information on all

DSUE amounts received from the donor's

Part 1—Generation-Skipping

last deceased spouse and any previously

Taxable

Applicable

deceased spouses. Each line in the chart

Transfers

Gifts to B

Applicable

Exclusion

should reflect a different predeceased

_______

exclusion

Enter in Part 1 all of the gifts you listed in

Expended

spouse.

allocable to gifts to

Total

on all

Part 2 of Schedule A, in the same order

Taxable

taxable gifts

and showing the same values.

Gifts

Part 1. DSUE Received From the

Last Deceased Spouse

Column B

$3 million

In this Part, include information about the

If you are reporting a generation-skipping

_______

$4 million

= 2,400,000

DSUE amount from the donor's most

transfer that occurred because of the

$5 million

recently deceased spouse (whose date of

close of an ETIP, complete column B for

death is after December 31, 2010). In

In 2011, A expended $2,400,000 of his

such transfer as follows.

column E, enter the total of the amount in

applicable exclusion on the taxable gift to

1. If the GST exemption is being

column D that the donor has applied to

allocated on a timely filed (including

gifts in previous years and is applying to

The second step of the procedure is to

extensions) gift tax return, enter the value

gifts reported on this return. A donor may

repeat the first step for every year where

as of the close of the ETIP.

apply DSUE only to gifts made after the

the donor made a taxable gift to a

DSUE arose.

2. If the GST exemption is being

same-sex spouse.

allocated on a late filed (past the due date

The third step of the procedure is to

including extensions) gift tax return, enter

Part 2. DSUE Received From Other

add up the result for all the years. The

the value as of the date the gift tax return

Predeceased Spouse(s)

result is the total amount of applicable

was filed.

exclusion expended on the same sex

Enter information about the DSUE amount

spouse. This amount of applicable

from the spouse(s), if any, who died prior

Column C

exclusion will be restored to the donor for

to the donor's most recently deceased

You are allowed to claim the gift tax

use on future gifts and bequests and is

spouse (but not before January 1, 2011) if

known as the Restored Exclusion Amount.

annual exclusion currently allowable for

the prior spouse's executor elected

Enter this amount on line 3 of Schedule C.

your reported direct skips (other than

portability of the DSUE amount. In column

certain direct skips to trusts—see Note),

Attach a statement to Form 709

D, indicate the amount of DSUE received

using the rules and limits discussed earlier

from the estate of each predeceased

detailing the calculation of the above

for the gift tax annual exclusion. However,

spouse. In column E, enter the portion of

procedure on the first Form 709 that you

you must allocate the exclusion on a

claim a Restored Exclusion Amount.

the amount of DSUE shown in column D

gift-by-gift basis for GST computation

that was applied to prior lifetime gifts or

The Restored Exclusion Amount

purposes. You must allocate the exclusion

transfers. A donor may apply DSUE only

will have to be accounted for the

to each gift to the maximum allowable

to gifts made after the DSUE arose.

donor on every subsequent Form

amount and in chronological order,

CAUTION

709 (and Form 706) that will be filed. This

Any remaining DSUE from a

beginning with the earliest gift that

predeceased spouse cannot be

means that on all future Forms 709 that

qualifies for the exclusion. Be sure that

applied against tax arising from

will be filed, the Restored Exclusion

you do not claim a total exclusion of more

CAUTION

Amount will need to be entered on

lifetime gifts if that spouse is not the most

than $14,000 per donee.

Schedule C. (The Restored Exclusion

recently deceased spouse on the date of

Amount will be entered on line 9c of Part

the gift. This rule applies even if the last

Note. You may not claim any annual

deceased spouse had no DSUE amount

2—Tax Computation on Form 706.) In

exclusion for a transfer made to a trust

or made no valid portability election, or if

addition, the Worksheet for Schedule B,

unless the trust meets the requirements

Column C (Credit Allowable for Prior

the DSUE amount from the last deceased

discussed under Part 2—Direct Skips.

Periods) should reflect the Restored

spouse has been fully applied to gifts in

Part 2—GST Exemption

Exclusion Amount. For the period where

previous periods.

Reconciliation

the applicable exclusion was first restored,

and on every subsequent period listed on

Line 1

Determining the Applicable Credit

the worksheet, add the Restorable

Amount Including DSUE and the

Every donor is allowed a lifetime GST

Exclusion Amount to the total DSUE

exemption. The amount of the exemption

amount (if any) and enter the sum on

Restored Exclusion Amount

for 2017 is $5,490,000. For transfers

column H.

On line 1, enter the donor's basic

made through 1998, the GST exemption

exclusion amount; for 2017, this amount is

Completing Schedule C

was $1 million. The exemption amounts

$5,490,000. Add the amounts listed in

for 1999 through 2017 are as follows.

Complete Schedule C if the donor is a

column E from Parts 1 and 2 and enter the

surviving spouse who received a DSUE

total on line 2. On line 3, enter the

amount from one or more predeceased

Restored Exclusion Amount. On line 4,

spouses, or if the donor is a taxpayer who

enter the total of lines 1, 2, and 3. Using

made a taxable transfer to his same-sex

the Table for Computing Gift Tax,

spouse which resulted in a reduction of

determine the donor's applicable credit by

the taxpayer's available applicable

applying the appropriate tax rate to the

exclusion amount (or both).

amount on line 4. Enter this amount on

-17-

Instructions For Form 709 - United States Gift (And Generation-Skipping Transfer) Tax Return - 2017 Page 17

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