Form 706: United States Estate (And Generation-Skipping Transfer) Tax Return

DEFINITION of 'Form 706: United States Estate (And Generation-Skipping Transfer) Tax Return'

A tax form distributed by the Internal Revenue Service (IRS) used by the executor of an estate to determine if any taxes are owed. Form 706 is to be completed by the executor if the decedent is a U.S. resident or citizen, and the decedent's gross estate is valued at over a certain value (adjusted periodically). Estate taxes are not levied on the pieces inherited by individual beneficiaries but on the estate as a whole. Form 706 is also used to calculate the generation-skipping transfer (GST) tax.

BREAKING DOWN 'Form 706: United States Estate (And Generation-Skipping Transfer) Tax Return'

Form 706 must be completed within nine months of the decedent's death unless the IRS has granted an extension. A six month extension can be requested through Form 4768. For decedent's who were neither U.S. citizens or residents at the time of death, executors should complete Form 706-NA.

RELATED TERMS
  1. Form 706-NA: United States Estate ...

    A tax form distributed by the Internal Revenue Service (IRS) ...
  2. Decedent

    A person who is no longer living. Just as a taxpayer's possessions ...
  3. Income In Respect Of A Decedent ...

    Money that was due to a decedent and will pass through to the ...
  4. Decedent (IRD) Deduction

    The decedent or IRD deduction stands for Income in Respect of ...
  5. Final Return For Decedent

    The final tax return filed for an individual in the year of that ...
  6. Laughing Heir

    A distant relative who has inheritance rights despite not having ...
Related Articles
  1. Managing Wealth

    Before You Agree to Be an Executor: Know This

    How to avoid 5 surprising hazards of being the executor of an estate.
  2. Financial Advisor

    How Life Insurance Can Help Reduce Estate Taxes

    Inheritance is a double-edged sword, as leaving money can create estate tax burdens. Opting for a life insurance plan can help mitigate those burdens.
  3. Retirement

    How To Choose The Right Executor For Your Estate

    Making a careful choice now can save your heirs from a lot of problems later.
  4. Financial Advisor

    An in Depth Look at How Inheritances Are Taxed

    The tax implications of an inheritance can be complex. Here's what beneficiaries need to know.
  5. Managing Wealth

    Avoid These 4 Common Causes of Family Estate Fights

    Sibling battles over their parents' belongings are quite common. But open family discussions before the parent dies can often prevent them.
  6. Financial Advisor

    4 Things To Consider Before Becoming An Estate Executor

    Executing a will takes more work than you might think. Make sure you are up to the task before agreeing to be an executor.
  7. Personal Finance

    Estate Taxes: Who's on the Hook?

    Inheritance taxes can be tricky. Most people have to deal with them at a very inconvenient time. It's better to learn the laws now so you're ready later.
  8. Managing Wealth

    Get Ready For The Estate Tax Phase-Out

    Changes to federal legislation will affect how your assets are treated once you're gone - be prepared.
  9. Retirement

    How Much Will You Owe on Your Inheritance?

    Estate planning can be unpleasant, but in order to get the full benefit of what you've inherited, it’s important to be prepared for the related taxes.
  10. Personal Finance

    Tax-Saving Advice for IRA Holders

    Be informed about benefits and deductions that may apply to you and avoid costly mistakes on your return.
RELATED FAQS
  1. How do I handle the taxes 1099-R contributions?

    Total employee’s contributions on the 1099 R form are $18,822.00. Does the executor of the estate ... Read Answer >>
  2. How are life insurance proceeds taxed?

  3. How can I reduce the taxes on my inherited retirement assets?

    Many beneficiaries miss out on one of the most significant tax deductions for inherited retirement-plan assets; the income ... Read Answer >>
  4. What should I consider when I select an executor for my will?

    The executor of a will is the person designated with the task of administering the will's instructions. The responsibilities ... Read Answer >>
  5. What do we need to do to make an agreement for the purchase of the ownership shares?

    The house belonged to my grandparents who are deceased. In my grandmother's will everything was to be left to her 5 grandchildren. ... Read Answer >>
  6. What would the estate tax be on life insurance policy of $25,000?

    $25,000 was paid to the beneficiary of a life insurance policy. What would the estate tax be and do you have to pay an estate ... Read Answer >>
Hot Definitions
  1. Quantitative Trading

    Trading strategies based on quantitative analysis which rely on mathematical computations and number crunching to identify ...
  2. Bond Ladder

    A portfolio of fixed-income securities in which each security has a significantly different maturity date. The purpose of ...
  3. Duration

    A measure of the sensitivity of the price (the value of principal) of a fixed-income investment to a change in interest rates. ...
  4. Dove

    An economic policy advisor who promotes monetary policies that involve the maintenance of low interest rates, believing that ...
  5. Cyclical Stock

    An equity security whose price is affected by ups and downs in the overall economy. Cyclical stocks typically relate to companies ...
  6. Front Running

    The unethical practice of a broker trading an equity based on information from the analyst department before his or her clients ...
Trading Center