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2014 Estate Tax (Form 706) Stephenson & Co., Inc. Certified Public Accountants 11493 Gray Street Westminster, CO 80020 303/525-4272 Shelby cpafirm4u.com Estate Tax (Form 706) Estate Tax Exclusion

How to fill out estate tax form 706

How to fill out estate tax form 706:

1. Gather all necessary information: Before starting to fill out the estate tax form 706, gather relevant documents such as the decedent's will, trust documents, financial statements, and any previous gift tax returns. It is essential to have accurate information on the decedent's assets, liabilities, and transfers made during their lifetime.
2. Identify the executor: The executor is responsible for filing the estate tax form 706. Ensure you know who the designated executor is and provide their contact information, including their name, address, and taxpayer identification number.
3. Complete the decedent's information: Begin by entering the decedent's personal information, including their name, social security number, and date of death. Additionally, provide the decedent's address and employment information.
4. Calculate the value of the gross estate: List all the assets owned by the decedent at the time of their death, including real estate, bank accounts, stocks, bonds, vehicles, and other personal property. Assign a fair market value to each asset as of the date of death.
5. Determine allowable deductions: Identify any deductions that may reduce the value of the gross estate. These deductions can include mortgages, debts, funeral expenses, estate administration expenses, and qualified charitable donations.
6. Calculate the taxable estate: Subtract the allowable deductions from the gross estate to determine the taxable estate. This will be the value used to calculate the estate tax liability.
7. Apply applicable tax rates: Use the estate tax table provided by the Internal Revenue Service (IRS) to calculate the estate tax liability based on the taxable estate. The tax rates may vary depending on the year of the decedent's death, so ensure you refer to the correct table.
8. Consider additional forms and schedules: Depending on the complexity of the estate, you may need to complete additional forms and schedules along with form 706. These forms could include Schedule A for real estate, Schedule B for stocks and bonds, Schedule D for certain debts, and other schedules as required.
9. Review and file the form: Carefully review the completed form 706, ensuring all information is accurate and supported by appropriate documentation. Once reviewed, sign and date the form before submitting it to the IRS.

Who needs estate tax form 706?

The estate tax form 706 is required to be filed by the executor of an estate when the total value of the decedent's estate exceeds the federal estate tax exemption amount for the year of their death. The exact exemption amount varies each year and should be checked with the IRS. Additionally, some states have their own estate tax laws, which may have different exemption thresholds and filing requirements. It is essential to consult with a qualified tax professional to determine if you meet the criteria for filing form 706.

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What is estate tax form 706?

Estate tax form 706 is a form used to report the value of a decedent's estate and calculate any estate tax that may be due.

Who is required to file estate tax form 706?

The executor of an estate is required to file estate tax form 706 if the gross estate of the decedent meets certain thresholds set by the IRS.

How to fill out estate tax form 706?

Estate tax form 706 must be completed with accurate information about the decedent's assets, liabilities, and deductions, and submitted to the IRS.

What is the purpose of estate tax form 706?

The purpose of estate tax form 706 is to determine the amount of estate tax owed on a decedent's estate and ensure compliance with tax laws.

What information must be reported on estate tax form 706?

Information such as the decedent's assets, debts, gifts made during their lifetime, and other relevant financial details must be reported on estate tax form 706.