Instructions For Form 706-Gs(D-1)- Notification Of Distribution From A Generation-Skipping Trust (Page 5 of 5) in pdf

the value of the property transferred at

1. The value of the current transfer

must be refigured. See Multiple

the time the allocation is filed with the

(minus any federal estate tax or state

transfers into a trust for the rule on how

IRS.

death tax actually paid by the trust

to refigure the inclusion ratio.

attributable to such property) and any

Qualified terminable interest

Paperwork Reduction Act Notice.

charitable deduction allowed with

property. For qualified terminable

We ask for the information on this form

respect to such property and

interest property (QTIP) that is included

to carry out the Internal Revenue laws of

2. The value of all property in the

in the estate of the surviving spouse of

the United States. You are required to

trust immediately before the current

the settlor because of section 2044,

give us the information. We need it to

transfer.

unless a special QTIP election has been

ensure that you are complying with

made under section 2652(a)(3), the

these laws and to allow us to figure and

Charitable lead annuity trusts. For

surviving spouse is considered the

collect the right amount of tax.

distributions from a charitable lead

transferor under section 2652(a) for

annuity trust, the numerator of the

You are not required to provide the

GST purposes, and the value is the

applicable fraction is the adjusted GST

information requested on a form that is

estate tax value in the estate of the

exemption as defined below. The

subject to the Paperwork Reduction Act

surviving spouse.

denominator is the value of the trust

unless the form displays a valid OMB

A special QTIP election allows

immediately after termination of the

control number. Books or records

property for which a QTIP election was

charitable lead annuity.

relating to a form or its instructions must

made for estate or gift tax purposes to

The adjusted GST exemption is the

be retained as long as their contents

be treated for GST tax purposes as if

sum of:

may become material in the

this QTIP election had not been made. If

administration of any Internal Revenue

1. The exemption allocated to the

the special QTIP election has been

law. Generally, tax returns and return

trust and

made, the predeceased settlor spouse

information are confidential, as required

is the transferor and the value is that

2. Interest on the exemption

by section 6103.

spouse's estate or gift tax value under

determined at the interest rate used to

the rules described above. Either the

figure the estate or gift deduction for the

The time needed to complete and file

settlor spouse or the executor of the

charitable lead annuity and for the

this form will vary depending on

settlor spouse's estate must make the

actual period of the charitable lead

individual circumstances. The estimated

special QTIP election.

annuity.

average time is:

ETIP. If an individual could not make

In the case of a late allocation, the

Recordkeeping

1 hr., 33 min.

. . . . .

a timely allocation of exemption

amount of interest accrued prior to the

because of an ETIP, the value of the

Learning about the

date of allocation is zero.

property for the purpose of computing

law or the form

1 hr., 46 min.

. . .

Column e. Value

the inclusion ratio is the estate tax value

Preparing the

Enter the value of the property

if the property is includible in the

form

42 min.

. . . . . . . . . . .

distributed from the trust at the time of

transferor's gross estate. If the property

distribution.

is not includible in the transferor's gross

Copying,

estate, the property is valued at the

assembling, and

Part III—Trust Information

close of the ETIP, provided that the GST

sending the form

exemption is allocated on a timely filed

to the IRS

20 min.

. . . . . . .

Line 4

gift tax return for the calendar year in

An arrangement that has substantially

which the ETIP closes.

the same effect as a trust will be treated

If you have comments concerning the

Multiple transfers into a trust. When

as a trust even though it is not an

a transfer is made to a pre-existing trust,

accuracy of these time estimates or

explicit trust. Examples of such

the applicable fraction must be

suggestions for making this form

arrangements are insurance and

recomputed. The numerator of the new

simpler, we would be happy to hear

annuity contracts, arrangements

fraction is the sum of:

from you. You can send us comments

involving life estates and remainders,

from IRS.gov/FormsComments. Or you

1. The exemption allocated to the

and estates for years. Nonexplicit trusts

can write to the Internal Revenue

current transfer and

do not include decedent's estates.

Service, Tax Forms and Publications

2. The nontax portion of the trust

Division, 1111 Constitution Ave. NW,

In the case of a nonexplicit trust, the

immediately before the current transfer

IR-6526, Washington, DC 20224. Do

trustee is the person in actual or

(the product of the applicable fraction

not send the tax form to this address.

constructive possession of the property

and the value of all of the property in the

Instead, see Where To File.

involved.

trust immediately before the current

transfer).

Line 5

The denominator of the new fraction

Whenever property is transferred into a

is the sum of:

pre-existing trust, the inclusion ratio

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Instructions For Form 706-Gs(D-1)- Notification Of Distribution From A Generation-Skipping Trust Page 5

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