Definition of Form 706-NA


What is Form 706-NA: United States Inheritance (and Generation Default Transfer) Tax Return?

Form 706-NA: United States Estate Tax Return (and Generation Default Transfer) is a tax form distributed by the IRS that is used to calculate the tax liability of the estates of persons with assets in the US. Non-citizens and are not considered resident aliens.

Key takeaways

  • Form 706-NA is used to calculate inheritance tax liabilities for individuals with assets in the US who are part of your estate and who are not citizens.
  • Assets based in the US that would be considered part of an estate would include real estate, physical personal property and securities related to US companies.
  • Executors of estates who should complete Form 706-NA must file a tax return if the fair market value of the estate was at least $ 60,000.

Who can file Form 706-NA: United States Inheritance (and Generation Transfer) Tax Return?

This Internal Revenue Service (IRS) form is used to calculate the generation skip tax liability for property owned by non-resident aliens in the United States. The generational omission tax is applied when the transfer of the deceased’s inheritance occurs and not when it is received by a beneficiary.

A nonresident alien is someone who does not live in the United States and is not a citizen. The IRS has specific rules on how a person meets the criteria of a resident alien. Those non-citizens who do not meet these requirements will be considered non-resident aliens.

Assets based in the US that would be considered part of an estate would include real estate, physical personal property and securities related to US companies. These US-based stocks would be subject to US inheritance tax, even if the certificates were physically stored outside of the country.

Form 706-NA: The United States inheritance (and omission of generations) tax return must be filed within nine months of the person’s death; however, an extension of the term of six months can be requested, which would give the estate a total of 15 months to present its tax return documentation.

How to File Form 706-NA: United States Inheritance (and Generation Default Transfer) Tax Return

Executors of estates who should complete Form 706-NA must file a tax return if the fair market value of the estate was at least $ 60,000. However, in some cases, the estates may be required to file a tax return even if the value of the estate is less than that, that is, if the deceased made large lifetime donations of benefited U.S. assets. of the unified credit waiver.

Several countries have death tax treaties with the United States, and executors reporting information about an estate from one of those countries may have to attach a statement that the death tax treaty is being applied.

This form has been reviewed and updated several times over the past 50 years. Form 706-NA is available to taxpayers when requesting United States Form 706, Inheritance Tax Return (and Generation Omission Transfer). Citizens of US possessions, such as the US Virgin Islands, are not considered citizens on Form 706-NA.

Download Form 706-NA: United States Inheritance (and Generation Default Transfer) Tax Return

Here is the IRS link, which includes instructions, as well as the downloadable Form 706-NA: United States Inheritance Tax Return (and Generation Default Transfer).

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