- Who has to file Form 706
- The 2026 numbers on the return
- What counts in the gross estate
- The portability rule most small estates miss
- Deadlines, extensions and payment
- What changed on the current Form 706
- Attachments the IRS expects
- After you file: penalties, Form 8971 and closing letters
- The verdict
- Frequently asked questions
Form 706 is the United States Estate (and Generation-Skipping Transfer) Tax Return. The executor files it for a US citizen or resident who died with a gross estate, plus adjusted taxable gifts, above the basic exclusion amount, which is $15,000,000 for deaths in 2026. It's due 9 months after the date of death, and it's also the only way to pass a deceased spouse's unused exclusion to the surviving spouse, even when no tax is owed.
Every figure here comes from the IRS Instructions for Form 706 (Rev. July 2026) and the form itself, as of October 2026.
Who has to file Form 706
For decedents who died in 2026, the executor must file for every US citizen or resident in one of two situations:
- the gross estate, plus adjusted taxable gifts made after 1976 and any specific exemption used on gifts made after 8 September 1976, is more than $15,000,000; or
- the executor elects to transfer the deceased spousal unused exclusion (DSUE) amount to the surviving spouse, whatever the size of the estate.
Someone who was neither a US citizen nor a US resident at death files Form 706-NA instead. And if no executor has been appointed, the instructions treat every person in actual or constructive possession of the decedent's property as an executor who must file.
The 2026 numbers on the return
| Item | Amount for deaths in 2026 |
|---|---|
| Basic exclusion amount | $15,000,000 |
| Basic credit amount | $5,945,800 |
| Ceiling on special-use valuation | $1,460,000 |
| Amount used for the 2% portion of tax paid in installments | $1,940,000 |
| Basic exclusion amount for deaths in 2025, for comparison | $13,990,000 |
The rate table in the instructions tops out at 40% on amounts above $1,000,000 of the tentative tax base, which is why the exclusion matters so much: the credit wipes out the tax on everything up to the exclusion amount.
What counts in the gross estate
The gross estate is wider than most families expect. Alongside the obvious property, the instructions list:
- certain transfers made during life without full consideration
- annuities
- the includible part of joint property with right of survivorship and tenancies by the entirety
- certain life insurance proceeds, even when they're paid to beneficiaries rather than the estate
- digital assets, reported on Schedule F
- property the decedent held a general power of appointment over
- community property to the extent of the decedent's interest
- property outside the United States
The portability rule most small estates miss
This is where Form 706 earns its keep for estates that owe nothing. An executor can only pass the unused exclusion to the surviving spouse if Form 706 is filed on time, meaning within 9 months of death or before the end of an extension. If the estate never needed to file and missed that window, Rev. Proc. 2022-32 gives a route back: the return can be filed on or before the fifth anniversary of the death, marked at the top as filed under Rev. Proc. 2022-32 to elect portability.
There's another relief built in for these returns. An executor filing only to elect portability doesn't have to report the value of certain property that qualifies for the marital or charitable deduction, though an estimate of those assets still goes into the total gross estate.
Deadlines, extensions and payment
| Step | Rule |
|---|---|
| File Form 706 | Within 9 months after the date of death |
| Extension to file | Automatic 6 months on Form 4768 |
| Pay the tax | Also due within 9 months; a payment extension can be requested on Form 4768 |
| Pay over time | Elections under section 6166 (installments) or 6163 (reversionary or remainder interests), made on Part III |
| Late portability election | Up to the fifth anniversary of death under Rev. Proc. 2022-32, if no filing was otherwise required |
What changed on the current Form 706
The form and schedules were redesigned, and every schedule is now separate from the main form. Schedule A-1 was renamed Schedule T, and the continuation schedule is now Schedule W. The current form is the August 2025 revision, which applies to decedents dying after 31 December 2024.
Attachments the IRS expects
- The death certificate, which must be attached.
- A certified copy of the will if the decedent died testate, or a copy with an explanation of why it isn't certified.
- Documents proving the executor's status, such as certified copies of the will or court orders. Statements by executors aren't enough.
- Copies of other tax returns filed with Form 706, identified as exhibits.
- Form 2848 if someone else will represent the estate, or Form 8821 if they only need to see the information.
Lifetime gifts link straight into this return through adjusted taxable gifts, so pull together the decedent's Form 709 gift tax returns early. The estate's own income is a separate job on Form 1041.
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After you file: penalties, Form 8971 and closing letters
Late filing and late payment both carry penalties unless there's reasonable cause. Don't attach a reasonable-cause explanation to the return; the instructions say explanations sent with the return won't be considered, and you should wait for a penalty notice and reply to it.
Valuations get extra scrutiny. A 20% penalty applies to underpayments caused by a substantial valuation understatement, meaning property reported at 65% or less of its real value. If it's 40% or less, that's a gross valuation understatement and the penalty rises to 40% of the underpayment. No penalty applies if the underpayment from these understatements doesn't exceed $5,000, as of October 2026.
- Form 8971: if the estate has to report basis information to beneficiaries, Form 8971 is filed separately from Form 706.
- Estate tax closing letter: it's only issued on request through Pay.gov, with a user fee, and the IRS asks you to wait at least 9 months after filing before you request one.
- Account transcript: instead of a closing letter, the executor can ask for an account transcript showing the return was accepted or the examination finished, using Form 4506-T or a tax professional's online access.
The verdict
If the estate is over $15,000,000, Form 706 isn't optional and the 9-month clock is tight, so file Form 4768 early if valuations are slow. If the estate is well under it and there's a surviving spouse, file anyway to elect portability. It costs paperwork now, but it's the only way to carry that unused exclusion forward, and it's far easier inside the 9 months than leaning on the five-year route later.
Frequently asked questions
What is Form 706 used for?
It's the United States Estate (and Generation-Skipping Transfer) Tax Return that an executor uses to figure the estate tax and the GST tax on direct skips.
When is Form 706 due?
Within 9 months after the date of death, with an automatic 6-month extension available on Form 4768.
What is the estate tax exemption for 2026?
The basic exclusion amount for decedents dying in 2026 is $15,000,000, as of October 2026.
Do I need to file Form 706 if no estate tax is owed?
Only if you want to elect portability of the deceased spousal unused exclusion, which requires a timely filed Form 706 whatever the size of the estate.
Can I file Form 706 late just to elect portability?
Executors who had no filing requirement can file on or before the fifth anniversary of the death under Rev. Proc. 2022-32.
