Instructions for Form 706-GS(D), Generation-Skipping Transfer Tax Return for Distributions

• Legal Form Number: 706-GS(D)
• Year: 2019
• Issuer: Treasury Department
• Section: Treasury Department

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Instructions for

Form 706-GS(D)

(Rev. June 2019)

Generation-Skipping Transfer Tax Return for Distributions

Department of the Treasury

Internal Revenue Service

Section references are to the Internal

Revenue Code unless otherwise noted.

Future Developments

For the latest information about

developments related to Form

706-GS(D) and its instructions, such

as legislation enacted after they were

published, go to IRS.gov/

Form706GSD.

What’s New

New filing address. Effective July 1,

2019, Form 706-GS(D) will be filed in

Kansas City, Missouri. See Where To

File, later.

General Instructions

Purpose of Form

Form 706-GS(D) is used by a skip

person distributee to calculate and

report the tax due on distributions

from a trust that are subject to the

generation-skipping transfer (GST)

tax.

Who Must File

In general, any skip person who

receives a taxable distribution from a

trust must file Form 706-GS(D).

Trustees are required to report

taxable distributions to skip person

distributees on Form 706-GS(D-1),

Notification of Distribution From a

Generation-Skipping Trust.

If you receive a Form 706-GS(D-1)

and the inclusion ratio found on Part II,

line 3, column d, is zero for all

distributions, you do not need to file

Form 706-GS(D). If you are required

to file Form 706-GS(D), you do not

have to include any distributions that

have an inclusion ratio of zero.

When To File

The GST tax on distributions is figured

and reported on a calendar year

basis, regardless of your income tax

accounting period. Generally, you

must file Form 706-GS(D) on or after

January 1 but not later than April 15 of

the year following the calendar year

when the distributions were made.

If you are not able to file the return

by the due date, you may request an

automatic 6-month extension of time

to file by filing Form 7004, Application

for Automatic Extension of Time To

File Certain Business Income Tax,

Information, and Other Returns. The

extension is automatic, so you do not

have to sign the form or provide a

reason for your request. You must file

Form 7004 on or before the regular

due date of Form 706-GS(D). See

Form 7004 for more information.

Private delivery services (PDSs).

You can use certain PDSs designated

by the IRS to meet the "timely mailing

as timely filing/paying" rule for tax

returns and payments. Go to IRS.gov/

PDS for the current list of designated

services.

The PDS can tell you how to get

written proof of the mailing date.

For the IRS mailing address to use

if you’re using a PDS, go to IRS.gov/

PDSStreetAddresses.

PDSs can’t deliver items to

P.O. boxes. You must use the

U.S. Postal Service to mail

any item to an IRS P.O. box address.

Where To File

On or before June 30, 2019, file Form

706-GS(D) at the following address:

Department of the Treasury

Internal Revenue Service Center

Cincinnati, OH 45999

If using a PDS, use this address.

Internal Revenue Submission

Processing Center

201 West Rivercenter Blvd.

Covington, KY 41011

After June 30, 2019, file Form

706-GS(D) at the following address:

CAUTION

!

Department of the Treasury

Internal Revenue Service Center

Kansas City, MO 64999

If using a PDS, use this address.

Internal Revenue Submission

Processing Center

333 W. Pershing

Kansas City, MO 64108

Penalties and Interest

Section 6651 provides penalties for

both late filing and late payment

unless there is reasonable cause for

the delay. The law also provides

penalties for willful attempts to evade

payment of tax.

A return is late when it is filed after

the due date, including extensions.

The late filing penalty will not be

imposed if the taxpayer can show that

the failure to file a timely return is due

to reasonable cause.

Reasonable cause determinations.

If you receive a notice about penalties

and interest after you file Form

706-GS(D), send us an explanation

and we will determine if you meet

reasonable cause criteria. Do not

attach an explanation when you file

Form 706-GS(D). Explanations

attached to the return at the time of

filing will not be considered.

Section 6662 provides a penalty for

underpayment of GST taxes which

exceeds $5,000, if the underpayment

is due to a valuation understatement.

A substantial valuation under-

statement occurs when the reported

value of property listed on Form

706-GS(D) is 65% or less of the actual

value of the property. A gross

valuation understatement occurs

when the reported value of property

listed on Form 706-GS(D) is 40% or

less of the actual value of the

property.

Interest will be charged on taxes

not paid by their due date, even if an

extension of time to file is granted.

Interest is also charged on any

January 15, 2019Cat. No. 10828G