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The U.S. Estate Tax Return or form 706 is the document the executor of a decedent’s residence uses to work out the levy he owes according to the IRC, Chapter 11. Note that sometimes an estate can be subject to tax at the state level even if on the federal level it is not.
What Is the Purpose of the Form 706?
The executor of the will must fill out and submit the document. The paper helps to identify the amount of taxes that have to be paid for an estate $11,400,000, in case the deceased passed away in 2019, and $11,580,000 if they died in 2020. However, there are certain nuances that must be taken into consideration. Therefore, it is advised to read the instructions first.
When Must Form 706 Be Filed?
The filled-out template must be filed within nine months from the date the descendant died. In several cases, you can automatically extend the period for submitting the template, getting 6 more months. However, the scope of circumstances for such an extension is limited.
What Is the Difference between Form 706 and 1041?
Situations concerning marital deductions are where the two templates most often get mixed up. According to the recent ruling of the U.S. Court of Appeals, when claiming a marital deduction, the first option is more applicable. Meanwhile, the main aim of blank 1041 is to inform the about profit taxes for estates and trusts.