IRS Form 706 for 2019: A Comprehensive Filing Checklist
Overview of Form 706 for 2019
The 2019 IRS Form 706 serves as the United States Estate and Generation-Skipping Transfer Tax Return for estates of decedents who died during calendar year 2019. This revision reflects continued application of the Tax Cuts and Jobs Act provisions, with inflation-adjusted amounts for the year. For decedents dying in 2019, the basic exclusion amount was set at $11,400,000, with a corresponding applicable credit amount of $4,505,800.
The August 2019 revision incorporates several important procedural updates, including new filing addresses effective July 1, 2019, and the separation of Schedule R-1 as a standalone form. Executors must carefully complete all applicable sections to ensure compliance with federal estate tax requirements and to preserve valuable tax benefits for surviving family members.
Filing Requirements and Deadlines
Form 706 must be filed for the estates of United States citizens or residents whose gross estate, combined with adjusted taxable gifts and specific exemptions, exceeds the $11,400,000 filing threshold for 2019. The return is generally due nine months after the date of the decedent’s death. However, executors may request an automatic six-month extension by filing Form 4768 before the original due date.
Even if an estate falls below the filing threshold, executors should consider filing Form 706 to elect portability of the deceased spouse's unused exclusion amount to a surviving spouse. This election allows the surviving spouse to apply the decedent’s unused exclusion amount to future transfers, potentially shielding millions of dollars from estate and gift taxes. Revenue Procedure 2017-34 continues to provide relief for executors who missed the original deadline to elect portability, allowing filing on or before the second anniversary of the decedent’s death.
Ten-Step Checklist for Completing Form 706
1. Assemble Complete Estate Documentation
Gather all documents related to the decedent’s assets and liabilities, including deeds, bank statements, brokerage account statements, insurance policies, business ownership documents, and professional appraisals. The death certificate must be attached to the return. If the decedent died testate, a certified copy of the will is also required. Collect documentation for real estate holdings, securities portfolios, mortgages, and notes receivable, life insurance proceeds, jointly owned property, transfers made during the decedent’s lifetime, powers of appointment, and annuities. Note the 2019 basic exclusion amount of $11,400,000, which is critical for determining whether the estate has a filing requirement and for calculating the estate tax liability.
2. Complete Special-Use Valuation Elections
If electing special-use valuation under section 2032A for qualified farm or business real property, complete both Schedule A for real estate and Schedule A-1 for the section 2032A valuation election. Schedule A-1 has been part of Form 706 for many years and is used to report the additional information required to support the special-use valuation election. Ensure all interested heirs sign the required agreement, accepting personal liability for potential recapture tax.
Attach the agreement to the return with detailed property descriptions, evidence of at least five years of material participation by the decedent or family members, and calculations proving compliance with statutory requirements. The maximum reduction in value under section 2032A for 2019 was $1,160,000.
3. Attach All Required Schedules
Complete all required schedules based on the types of assets in the estate and the deductions claimed. Schedule A reports real estate, Schedule B covers stocks and bonds, Schedule C lists mortgages and notes receivable, Schedule D includes life insurance proceeds, Schedule E addresses jointly owned property, Schedule F reports miscellaneous property, Schedule G covers transfers during the decedent’s life, Schedule H lists powers of appointment, and Schedule I addresses annuities.
Schedule M reports bequests to the surviving spouse qualifying for the marital deduction. Schedule O reports charitable, public, and similar gifts and bequests. Schedule P reports credits for foreign death taxes paid. Schedule Q reports credits for tax on prior transfers. Each schedule requires complete and accurate information with proper supporting documentation.
4. Calculate the Tentative Estate Tax Accurately
Calculate the tentative estate tax using Table A—Unified Rate Schedule provided in the instructions. The maximum estate tax rate of 40 percent applies to taxable amounts over one million dollars. Apply the $11,400,000 basic exclusion amount correctly when computing the applicable credit. The appropriate credit amount for 2019 is $4,505,800, based on the basic exclusion amount.
Verify that calculations align with the 2019 instructions and that all worksheets for adjusted taxable gifts and gift tax computations are correctly completed. The estate tax is figured by applying the unified rates to the total of transfers both during life and at death, then subtracting the gift taxes as refigured based on the date-of-death rates.
5. Report Charitable Deductions Properly
Ensure the applicable credit amount is correctly computed, considering the 2019 credit limits and any deceased spousal unused exclusion amount received from a predeceased spouse. Attach Schedule O if charitable deductions are involved. Schedule O is used exclusively to report charitable, public, and similar gifts and bequests under section 2055. Provide the name and address of each charitable beneficiary, the amount of each bequest, and sufficient detail to demonstrate that the transfer qualifies for the charitable deduction.
Eligible recipients include the United States government, state and local governments, qualifying religious and philanthropic organizations, and specific veterans organizations. Properly documented charitable bequests can significantly reduce the size of the taxable estate.
6. Execute Proper Signatures and Filing Information
Sign and date the return under penalty of perjury. The executor must sign the declaration on page 1 in every case. If there is more than one executor, all listed executors are responsible for the return, though only one signature is required if that executor is authorized to act on behalf of the others. Executors must provide documentation proving their status, such as a certified copy of the will or court orders that designate them as executors.
A statement by the executor attesting to their status is insufficient. If a paid preparer was used, that person must also sign and complete the Paid Preparer Use Only section. Reference the appropriate IRS filing address based on when the return is filed and whether it is an original or amended return.
7. Attach Required Appraisals and Supporting Documentation
Attach all applicable appraisals, documentation for special-use valuation, conservation easements if claiming the qualified conservation easement exclusion on Schedule U, and foreign death taxes if claiming the credit on Schedule P. For real estate reported on Schedule A, attach detailed legal descriptions and professional appraisals. For items of tangible personal property reported on Schedule F with individual values exceeding three thousand dollars, attach appraisals from qualified professionals.
Life insurance policies must be supported by Form 712 from each insurance company. Attach copies of all Forms 709 filed by the decedent for lifetime gifts, as these are needed to complete the gift tax reconciliation worksheets. Include state certification of payment of death taxes if claiming a state death tax deduction on line 3b of Part 2.
8. Complete Generation-Skipping Transfer Tax Schedules
Confirm that all supporting schedules are included if relevant to the estate’s circumstances. Schedule R calculates the generation-skipping transfer tax on direct skips from the estate to skip persons, such as grandchildren or more remote descendants. Beginning in 2019, Schedule R-1 is a separate form that must be obtained independently rather than being included in the Form 706 package.
Schedule R-1 is used to figure the GST tax payable by certain trusts included in the gross estate and serves as notification from the executor to the trustee that GST tax is due. The GST exemption for 2019 equals the basic exclusion amount of $11,400,000. Proper allocation of the GST exemption preserves wealth for younger generations while minimizing transfer tax liability.
9. Review for Completion Accuracy
Review the form for completion accuracy, particularly the lines related to the basic exclusion amount, tentative tax, and credits. Verify that line 9a of Part 2 correctly reflects the $11,400,000 basic exclusion amount for 2019. Ensure that line 9b correctly reports any restored exclusion amount for same-sex spouse transfers under Notice 2017-15. Confirm that line 9c accurately reflects any deceased spousal unused exclusion amount received from a predeceased spouse as calculated in Part 6.
Check that the applicable credit amount of $4,505,800 or the adjusted amount based on the total applicable exclusion amount is correctly calculated. Verify that all schedules are properly totaled and that the recapitulation on Part 5 accurately reflects all assets and deductions.
10. File Using Correct Addresses and Procedures
File the completed form using the address specified by the IRS for estate filings in 2019, ensuring compliance with all submission requirements and deadlines. Effective July 1, 2019, the primary filing address for Form 706 changed to Kansas City, Missouri. For returns filed before July 1, 2019, use the Cincinnati, Ohio, address.
If filing an amended Form 706, use the Florence, Kentucky, address regardless of filing date. Include Form 8971, Information Regarding Beneficiaries Acquiring Property From a Decedent, to satisfy consistent basis reporting requirements. Staple all required pages together in proper order and retain copies of the complete return and all attachments for the estate’s records.
Key 2019 Form Updates and Special Considerations
New Filing Addresses Effective July 1, 2019
One of the most significant procedural changes for 2019 was the implementation of new filing addresses. For original Form 706 returns filed on or after July 1, 2019, the filing address is Department of the Treasury, Internal Revenue Service, Kansas City, MO 64999. If using a private delivery service, use the following address: Internal Revenue Service Submission Processing Center, 333 W. Pershing Road, Kansas City, MO 64108.
For amended Form 706 returns, regardless of filing date, the address is Internal Revenue Service Center, Attn: E&G, Stop 824G, 7940 Kentucky Drive, Florence, KY 41042-2915. These address changes were implemented to improve processing efficiency and should be carefully noted by all filers.
Schedule R-1 Separation
Beginning with the 2019 revision, Schedule R-1 is no longer included in the Form 706 package. Executors must obtain a separate Schedule R-1 form to report the generation-skipping transfer tax payable by certain trusts and to complete and file it with Form 706. Schedule R-1 serves as notification from the executor to the trustee that GST tax is due, and under section 2603(a)(2), the trustee, rather than the estate, is responsible for paying this tax. This separation was implemented to clarify the distinct nature of GST tax reporting at the trust level and to ensure proper notification procedures are followed.
Inflation-Adjusted Amounts for 2019
The 2019 instructions reflect inflation-adjusted amounts for several key thresholds. The basic exclusion amount increased to $11,400,000, resulting in an applicable credit amount of $4,505,800. The ceiling on special-use valuation under section 2032A increased to $1,160,000. The amount used in calculating the 2 percent portion of the estate tax payable in installments under Section 6166 has risen to $1,550,000.
These inflation adjustments continue the framework established by the Tax Cuts and Jobs Act while accounting for cost-of-living changes. The IRS publishes updated amounts for future years in annual revenue procedures.
Portability Election Procedures
Part 6—Portability of Deceased Spousal Unused Exclusion allows estates to elect portability of any unused exclusion amount to a surviving spouse. This election is automatic upon timely filing of a complete and properly prepared Form 706, even if the estate is not otherwise required to file. Executors who do not wish to make the portability election must affirmatively opt out by checking the appropriate box in Section A of Part 6.
The combination of the increased basic exclusion amount and portability allows married couples to effectively shield up to $22,800,000 from federal estate tax for deaths occurring in 2019, assuming both spouses died in that year.
Transfers During Decedent’s Life
Schedule G continues to serve its established purpose of reporting transfers during the decedent’s life that are included in the gross estate under sections 2035 through 2038. This includes gift taxes paid on gifts made within three years of death, transfers of life insurance policies within three years of death, transfers with retained life estates where the decedent retained the right to income or enjoyment, transfers taking effect at death where a reversionary interest of more than 5 percent was maintained, and revocable transfers where the decedent had the power to alter, amend, revoke, or terminate the transfer. Proper completion of Schedule G ensures that all taxable transfers are captured in the gross estate valuation.
This detailed checklist helps executors and tax professionals complete Form 706 for estates from 2019, ensuring they comply with the law and maximize tax benefits for heirs and beneficiaries.
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This checklist is for educational purposes only and does not constitute tax or legal advice. Always review official IRS instructions and consult a qualified professional for guidance.
