IRS Form 706 (2023): Estate Tax Filing & Late Guide

IRS Form 706 is the United States Estate and Generation-Skipping Transfer Tax Return used by executors to report estate tax liability for decedents who died during calendar year 2023. The form calculates taxable estate value, deductions, portability elections, and generation-skipping transfer tax obligations under federal estate tax law.

Late Filers

Executors who missed the original filing deadline may still file Form 706 for 2023, although penalties and interest continue accruing on unpaid estate taxes.

Estates With Complex Assets

Estates holding real estate, retirement accounts, business interests, or investment assets must report fair market values across the appropriate Form 706 schedules.

Itemizing Deductions

Executors may deduct funeral expenses, debts, charitable transfers, and administration costs when calculating the estate’s final taxable value for federal estate tax purposes.

Claiming 2023 Portability Election

Executors electing portability must properly transfer the deceased spouse’s unused exclusion amount to the surviving spouse using the required 2023 Form 706 procedures.

IRS Compliance

Filing Form 706 establishes an official federal estate tax record whenever the gross estate exceeds the applicable 2023 federal exemption threshold.

Nonresident Not a Citizen

Executors handling estates of nonresident non-citizens may need to file Form 706-NA and review applicable treaty provisions before reporting estate tax liability.

Follow the steps below to complete Form 706 for the 2023 tax year accurately. Several filing rules, portability procedures, and valuation requirements apply only to the 2023 revision.

Step 1: Gather Your Documents Before Starting

Collect financial records covering real estate, bank accounts, investment holdings, business interests, debts, and liabilities before preparing Form 706. Complete documentation helps prevent reporting errors, supports accurate estate tax calculations, and reduces IRS follow-up requests during estate administration.

Step 2: Identify the Executor and Estate Information

Complete Part 1 of Form 706 with the decedent's full legal name, Social Security number, date of death, and domicile location. The executor's name, address, and contact information are also required. For portability elections, the legally married surviving spouse's Social Security number must be included—errors in this section delay IRS processing and all correspondence throughout estate administration.

Step 3: Report All Assets at Fair Market Value

Executors must report every gross estate asset at fair market value on the decedent’s date of death under IRC §1014. Estates electing alternate valuation under IRC §2032 may instead use values six months after death when doing so reduces both the taxable estate and total estate tax liability. Beneficiaries must also follow §1014(f) consistent-basis and Form 8971 reporting requirements.

Step 4: Include Adjusted Taxable Gifts and Generation-Skipping Transfers

Add all taxable gifts made after December 31, 1976, to the gross estate calculation. Executors must also report generation-skipping transfers involving trusts or skip persons, as these transfers affect the applicable credit amount and the final estate tax liability reported on Form 706.

Step 5: Calculate Deductions and Determine the Taxable Estate

Subtract all allowable deductions from the gross estate to arrive at the taxable estate. Deductions include the marital deduction for assets that pass outright to a legally married surviving spouse, charitable bequests, funeral expenses, debts, and estate administration expenses. Attach supporting schedules and documentation for every deduction category claimed on the return.

Step 6: Elect Portability if Applicable (2023 Only)

Executors transferring a deceased spouse's unused exclusion amount must complete the portability election under Rev. Proc. 2022-32. Estates above the filing threshold cannot use the late-election procedure, and missing election statements may result in the IRS denying portability.

Missing W-2s or Tax Records for 2023?

Executors filing late or correcting prior returns may no longer have complete financial records for the decedent’s estate. IRS transcripts and SSA records can help reconstruct information needed to complete Form 706 accurately and support reported estate values.

IRS Wage & Income Transcript

The IRS wage and income transcript shows wages, dividends, retirement distributions, and interest reported under the decedent’s Social Security number for estate reporting purposes and verification.

IRS Account Transcript

An IRS account transcript confirms prior tax filings, payments, penalty activity, and IRS correspondence connected to the decedent’s taxpayer identification number and federal filing history.

Social Security Administration

SSA records provide earnings and benefit history that help executors identify income streams, account balances, and financial documentation relevant to accurate estate tax reporting requirements and calculations. 

Contact Prior Employers

Banks, brokerage firms, and prior employers may provide historical account statements, retirement balances, and benefit records needed to complete Form 706 schedules and verify reported estate values accurately.

Do not estimate asset values or income figures because IRS transcripts and official records help reduce reporting errors and follow-up notices.

These common filing mistakes often lead to IRS delays, rejected returns, denied elections, and increased estate tax liability.

• Using the wrong tax year form — Filing a Form 706 revision other than the 2023 version causes incorrect exemption calculations, schedule mismatches, and IRS processing delays.
• Missing or improperly documented portability election — Executors must attach the required portability election statement, or the IRS may completely deny the deceased spousal unused exclusion election. 

• Writing “Amended” instead of “Supplemental Information” — Corrected Form 706 filings must state “Supplemental Information” because the IRS does not recognize formal amended estate tax return procedures.
• Omitting the §2032 alternate valuation election — Executors who fail to evaluate alternate valuation may miss opportunities to reduce both the gross estate and total estate tax liability.
• Omitting adjusted taxable gifts and direct skips — Failing to report post-1976 taxable gifts or generation-skipping transfers understates the taxable estate. It commonly triggers IRS review, corrections, and additional estate tax assessments.
• Incomplete or unattached supporting schedules — Missing deduction schedules or supporting attachments commonly cause the IRS to disallow deductions, increase estate tax liability amounts, and delay overall return processing procedures.
• Missing or incorrect Social Security numbers — Incorrect Social Security numbers for the decedent, surviving spouse, or beneficiaries commonly delay IRS processing, estate tax correspondence, and portability election review procedures. 
• Unsigned return —Form 706 must include the executor’s signature because unsigned estate tax returns are not treated as valid IRS filings or accepted submissions.
• Presenting the wrong fiduciary authority document — Using incorrect fiduciary documents when requesting records or filing Form 706 commonly delays estate administration, IRS correspondence, and return processing procedures. 

What is IRS Form 706 (2023) used for?

IRS Form 706 for tax year 2023 is used to calculate federal estate tax and generation-skipping transfer tax owed on a decedent’s estate. Executors also use the form to report deductions, portability elections, taxable gifts, and other estate tax information required by the Internal Revenue Service.

Can I still file a 2023 estate tax return?

Yes, executors may still file Form 706 after the original deadline, although penalties and interest continue accruing on unpaid estate tax balances. Filing now stops the failure-to-file penalty from increasing further, provided it has not already reached the maximum statutory percentage allgeneration-skipping transfers owed under federal tax law.

What is the federal estate tax exemption for 2023?

The federal estate tax exemption for 2023 is $12,920,000 per decedent. Estates exceeding that threshold after including adjusted taxable gifts generally must file Form 706 and calculate estate tax owed under applicable Internal Revenue Code provisions and federal estate tax regulations for the 2023 filing year.

What happens if I miss the portability election deadline?

Under Rev. Proc. 2022-32, some estates may still elect portability up to five years after the decedent’s date of death. However, this type of simplified late-election relief applies only to estates not otherwise required to file Form 706 under the federal estate tax filing threshold rules.

How long does the IRS take to process Form 706?

The IRS generally takes 6 to 9 months to process paper-filed Form 706 estate tax returns. Complex estates involving business interests, valuation disputes, or missing documentation may require additional time for the Internal Revenue Service to complete estate tax processing and related correspondence.

Does Form 706 apply to nonresident non-citizens?

Different estate tax rules apply to nonresident non-citizens of the United States, including separate exemption thresholds and U.S.-situs property reporting requirements. Executors handling these estates generally require reviewing Form 706-NA and applicable estate tax treaties before determining federal estate tax filing obligations.

What records are needed to file Form 706 late?

Executors who file Form 706 late generally need records showing the gross estate's asset values, lifetime taxable gifts, deductible expenses, and prior federal gift tax filings. IRS transcripts, property appraisals, and financial institution records may help reconstruct missing estate tax information and accurately support reported estate values.