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Department of the Treasury

Instructions for Form 706

Internal Revenue Service

(Rev. August 2008)

For decedents dying after December 31, 2007 and before January 1, 2009

United States Estate (and Generation-Skipping Transfer) Tax Return

•

Section references are to the Internal

Contents

Page

We added a new worksheet to help

executors figure how much of the

Revenue Code unless otherwise noted.

*Schedule C — Mortgages,

estate tax may be paid in installments

Notes, and Cash . . . . . . . . . . . . . 14

under section 6166. See Determine

*Schedule D — Insurance on

Prior Revisions of Form 706

how much of the estate tax may be

the Decedent’s Life . . . . . . . . . . . 14

paid in installments under section 6166

For

Use

*Schedule E — Jointly Owned

Decedents

Revision

on page 11 for details.

Property . . . . . . . . . . . . . . . . . . . 14

•

Dying

On January 1, 2008, the estate and

*Schedule F — Other

and

Form 706

gift tax treaty between the United

Miscellaneous Property . . . . . . . . 14

After

Before

Dated

States and Sweden was terminated and

Schedule G — Transfers

December

January

July 1999

ceased to have effect. Therefore, we

During Decedent’s Life . . . . . . . . . 15

31, 1998

1, 2001

have deleted the county “Sweden” from

Schedule H — Powers of

December

January

November

the list of countries under Credit Under

31, 2000

1, 2002

2001

Appointment . . . . . . . . . . . . . . . . 16

Treaties, In general on page 22.

December

January

August

Schedule I — Annuities . . . . . . . . . . . 17

•

Various dollar amounts and

31, 2001

1, 2003

2002

*Schedule J — Funeral

limitations relevant to Form 706 are

December

January

August

Expenses and Expenses

indexed for inflation. For decedents

31, 2002

1, 2004

2003

Incurred in Administering

dying in 2008, the following amounts

December

January

August

Property Subject to Claims . . . . . . 19

have increased:

31, 2003

1, 2005

2004

Schedule K — Debts of the

December

January

August

a. The ceiling on special-use

Decedent and Mortgages

31, 2004

1, 2006

2005

valuation is $960,000.

December

January

October

and Liens . . . . . . . . . . . . . . . . . . . 19

b. The amount used in computing

31, 2005

1, 2007

2006

Schedule L — Net Losses

the 2% portion of estate tax payable

December

January

September

During Administration and

in installments is $1,280,000.

31, 2006

1, 2008

2007

Expenses Incurred in

The IRS will publish amounts for

Administering Property Not

future years in an annual revenue

Contents

Page

Subject to Claims . . . . . . . . . . . . . 20

procedure.

General Instructions . . . . . . . . . . . .1

*Schedule M — Bequests, etc.,

Purpose of Form . . . . . . . . . . . . . . . .1

to Surviving Spouse (Marital

General Instructions

Which Estates Must File . . . . . . . . . .1

Deduction) . . . . . . . . . . . . . . . . . . 20

Executor . . . . . . . . . . . . . . . . . . . . . .2

Schedule O — Charitable,

Purpose of Form

When To File . . . . . . . . . . . . . . . . . .2

Public, and Similar Gifts and

Where To File . . . . . . . . . . . . . . . . . .2

Bequests . . . . . . . . . . . . . . . . . . . 20

The executor of a decedent’s estate

Paying the Tax . . . . . . . . . . . . . . . . .2

Schedule P — Credit for

uses Form 706 to figure the estate tax

Foreign Death Taxes . . . . . . . . . . 21

Signature and Verification . . . . . . . . .2

imposed by Chapter 11 of the Internal

Schedule Q — Credit for Tax

Revenue Code. This tax is levied on

Amending Form 706 . . . . . . . . . . . . .2

on Prior Transfers . . . . . . . . . . . . 22

the entire taxable estate, not just on the

Supplemental Documents . . . . . . . . .3

Schedules R and

share received by a particular

Rounding Off to Whole Dollars . . . . .3

beneficiary. Form 706 is also used to

R-1 — Generation-Skipping

Penalties . . . . . . . . . . . . . . . . . . . . . .3

compute the generation-skipping

Transfer Tax . . . . . . . . . . . . . . . . 23

Obtaining Forms and

transfer (GST) tax imposed by Chapter

Schedule U — Qualified

Publications . . . . . . . . . . . . . . . . . .3

13 on direct skips (transfers to skip

Conservation Easement

Specific Instructions . . . . . . . . . . . .3

persons of interests in property

Exclusion . . . . . . . . . . . . . . . . . . . 27

Part 1 — Decedent and

included in the decedent’s gross

Continuation Schedule . . . . . . . . . . . 29

Executor (Page 1 of Form

estate).

Privacy Act and Paperwork

706) . . . . . . . . . . . . . . . . . . . . . . .4

Reduction Act . . . . . . . . . . . . . . . 30

Which Estates Must File

Part 2 — Tax Computation

Worksheet for Schedule Q . . . . . . . . 31

(Page 1 of Form 706) . . . . . . . . . . .5

For decedents dying in 2008, Form 706

Index . . . . . . . . . . . . . . . . . . . . . . . 32

Part 3 — Elections by the

must be filed by the executor for the

Checklist . . . . . . . . . . . . . . . . . . . . . 33

Executor (Page 2 of Form

estate of every U.S. citizen or resident

* For Schedules A, A-1, C, D, E, F,

706) . . . . . . . . . . . . . . . . . . . . . . .6

whose gross estate, plus adjusted

J, and M, see instructions in the

Part 4 — General Information

taxable gifts and specific exemption, is

Form 706 itself.

more than $2,000,000.

(Pages 2 and 3 of Form 706) . . . . 12

Part 5 — Recapitulation (Page

To determine whether you must file

3 of Form 706) . . . . . . . . . . . . . . . 12

a return for the estate, add:

*Schedule A — Real Estate . . . . . . . 13

What’s New

1. The adjusted taxable gifts (under

*Schedule A-1 — Section

section 2001(b)) made by the decedent

•

2032A Valuation . . . . . . . . . . . . . 13

Use this revision of Form 706 only for

after December 31, 1976;

Schedule B — Stocks and

the estates of decedents dying in

2. The total specific exemption

Bonds . . . . . . . . . . . . . . . . . . . . . 13

calendar year 2008.

allowed under section 2521 (as in effect

Cat. No. 16779E

Instructions For Form 706 - United States Estate (And Generation-Skipping Transfer) Tax Return - 2008

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