Instructions For Form 706-Gs(D-1) - 2016 Page 4
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5An exception to this is distributions from
The inclusion ratio is the excess of 1
Once made, allocations are
“separate trusts” as that term was
over the applicable fraction determined
irrevocable.
defined earlier. You must report
for the trust from which the distribution
Allocation of the GST exemption is
distributions from such separate trusts
was made.
made by the settlor on Form 709, United
under different item numbers even if
States Gift (and Generation-Skipping
Applicable fraction. The applicable
they have the same inclusion ratio.
Transfer) Tax Return, and/or Form 706,
fraction is a fraction, the numerator of
United States Estate (and
Column b. Description of
which is the amount of the GST
Generation-Skipping Transfer) Tax
exemption allocated to the trust. The
Property
Return, by the executor of the settlor's
denominator of the fraction is:
estate. Therefore, you should obtain
Real estate. Describe the real estate in
1. The value of the property
information regarding the allocation of
enough detail so that the IRS can easily
transferred to the trust, minus
the exemption to this trust from the
locate it for inspection and valuation.
2. The sum of:
settlor or the executor of the settlor's
For each parcel of real estate, report the
estate, as applicable.
location and, if the parcel is improved,
a. Any federal estate tax or state
describe the improvements. For city or
death tax actually recovered from the
If the settlor's entire GST exemption
trust attributable to the property and
town property, report the street number,
is not allocated by the due date
ward, subdivision, block and lot, etc. For
b. Any charitable deduction allowed
(including extensions) of the settlor's
rural property, report the township,
under section 2055 or 2522 with respect
estate tax return, the exemption is
range, landmarks, etc.
to the property.
automatically allocated under the rules
of section 2632.
Stocks and bonds. For stocks, give:
Round the applicable fraction to at
Number of shares;
Transfers subject to an estate tax in-
least the nearest one-thousandth (for
Whether common or preferred;
clusion period. If a transferor made an
example, “.001”).
Issue;
inter vivos transfer, and the property
Numerator (GST exemption). Every
Par value where needed for
transferred would have been includible
individual settlor is allowed a lifetime
valuation;
in the transferor's estate if he or she had
GST exemption to be allocated against
Price per share;
died immediately after the transfer
property that the individual has
Exact name of corporation;
(other than by reason of the transferor
transferred. For generation-skipping
Principal exchange upon which sold,
dying within 3 years of making the gift),
transfers made through 1998, the
if listed on an exchange; and
for purposes of determining the
exemption was $1 million. The GST
CUSIP number.
inclusion ratio, an allocation of GST
exemption amounts for 1999 through
exemption will only become effective at
For bonds, give:
2016 are as follows:
the close of the estate tax inclusion
Quantity and denomination;
period (ETIP).
Name of obligor;
Year
Amount
Date of maturity;
The value of the property for the
1999
$1,010,000
. . . . . . . . . . . . . .
Interest rate;
purpose of figuring the inclusion ratio is
2000
$1,030,000
. . . . . . . . . . . . . .
Interest due date;
the estate tax value if the property is
2001
$1,060,000
. . . . . . . . . . . . . .
Principal exchange, if listed on an
included in the transferor's gross estate,
2002
$1,100,000
. . . . . . . . . . . . . .
exchange; and
or its value at the close of the ETIP.
2003
$1,120,000
. . . . . . . . . . . . . .
CUSIP number.
The ETIP closes at the earliest of:
2004 and 2005
$1,500,000
. . . . . . . .
If the stock or bond is unlisted, show
2006–2008
$2,000,000
. . . . . . . . . .
1. The time the transferred property
the company's principal business office.
2009
$3,500,000
. . . . . . . . . . . . . .
would no longer be includible in the
The CUSIP (Committee on Uniform
2010 and 2011
$5,000,000
. . . . . . . .
settlor's estate,
Security Identification Procedure)
2012
$5,120,000
. . . . . . . . . . . . . .
2. The date of a generation-
number is a nine-digit number that is
2013
$5,250,000
. . . . . . . . . . . . . .
skipping transfer of the property, or
assigned to all stocks and bonds traded
2014
$5,340,000
. . . . . . . . . . . . . .
3. The date of death of the settlor.
on major exchanges and many unlisted
2015
$5,430,000
. . . . . . . . . . . . . .
securities. Usually the CUSIP number is
2016
$5,450,000
. . . . . . . . . . . . . .
Denominator (valuation of trust as-
printed on the face of the stock
sets). In general, the value to be used
certificate. If the CUSIP number is not
in the applicable fraction is the gift tax
printed on the certificate, it may be
A valid Deceased Spousal
value for an inter vivos transfer as long
obtained through the company's
Unused Exclusion Amount
!
as the allocation of the GST exemption
transfer agent.
(“DSUE ” or portability) election
was made on a timely filed gift tax
CAUTION
by an executor of a deceased spouse's
Other personal property. Any
return. The value of a testamentary
estate does not apply to or impact GST
personal property distributed must be
transfer is generally the estate tax value.
tax exemption.
described in enough detail that the IRS
If the allocation of the exemption to
can value it.
For existing trusts, transferors may
an inter vivos transfer, made before
Column d. Inclusion Ratio
allocate the additional GST exemption
January 1, 2001, is not made on a
amount attributable to section 2631(c)
timely filed gift tax return, the value for
Note. The trustee must provide the
increases if they otherwise qualify under
purposes of the applicable fraction is
inclusion ratio for every distribution.
the existing rules for late allocations. For
the value of the property transferred at
All distributions, or any part of a single
more information, see section 2632 and
the time the allocation is filed with the
distribution, that have different inclusion
Multiple transfers into a trust later.
IRS.
ratios must be listed as separate items
in column a.
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