When Do You File an Estate Tax Return?

Form 706, the federal estate tax return, serves as a comprehensive document for estates of deceased individuals. Its primary purpose is to calculate any federal estate tax liability. This tax is imposed on the transfer of property from a deceased person’s estate to their heirs. The form provides a detailed accounting of the decedent’s assets and liabilities at the time of death to determine if tax is owed.

Gross Estate Value Thresholds

A federal estate tax return (Form 706) is generally required only if the gross estate of the deceased, combined with certain lifetime taxable gifts, exceeds a specific exemption amount. For individuals who pass away in 2025, this federal estate tax exemption amount is $13.99 million. This figure is adjusted annually for inflation.

The “gross estate” includes all property in which the decedent had an interest at the time of death, regardless of where it is located. This encompasses real estate, stocks, bonds, bank accounts, business interests, and life insurance proceeds payable to the estate. Even assets that pass directly to beneficiaries outside of probate, such as joint tenancy property or assets in a trust, are typically included when calculating the gross estate for tax purposes.

The concept of “portability” of a deceased spousal unused exclusion (DSUE) amount allows a surviving spouse to utilize any unused portion of their deceased spouse’s estate tax exemption. Electing portability can increase the amount a surviving spouse can pass free of estate tax, potentially affecting future filing requirements for their own estate.

Identifying the Filer

The responsibility for filing the federal estate tax return falls upon the “executor” or “administrator” of the estate. An executor is typically named in the deceased person’s will to manage their affairs after death. If no will exists, or if the named executor is unable or unwilling to serve, a probate court will appoint an administrator.

The executor or administrator has a range of responsibilities, including gathering all assets, paying legitimate debts and expenses, and distributing the remaining property to beneficiaries. Ensuring all necessary tax returns are filed, with Form 706 being a primary concern if the estate meets the filing threshold, is a core duty. The executor can be held personally liable for any unpaid estate taxes if assets are distributed to heirs before these tax obligations are satisfied.

Filing Deadlines and Extensions

The primary deadline for filing Form 706 is nine months after the date of the decedent’s death. This deadline applies uniformly, regardless of whether the estate is expected to owe federal estate tax or not, provided the gross estate exceeds the filing threshold. For example, if an individual dies on February 4th, the return would typically be due by November 4th of the same year.

If the executor anticipates needing more time to prepare the return, an automatic six-month extension can be requested. This is done by filing Form 4768, “Application for Extension of Time To File a Return and/or Pay U.S. Estate (and Generation-Skipping Transfer) Taxes,” with the Internal Revenue Service. This extension grants additional time to submit the return but does not extend the time to pay any estate tax due.

Interest and penalties may accrue on any unpaid tax from the original nine-month due date, even if an extension to file has been granted. The automatic extension is the most common recourse for estates requiring more time for filing.

Preparing for Filing

Gathering the necessary information and documentation is a significant undertaking when preparing Form 706. The executor must compile a comprehensive set of records to accurately report the estate’s value and any deductions. This preparatory phase ensures all assets and liabilities are properly accounted for before the form is completed.

Key documents include a certified copy of the decedent’s death certificate and their last will and testament, along with any codicils. Detailed inventory and valuation of all assets forming the gross estate are essential. This often requires professional appraisals for real estate, business interests, and valuable personal property, alongside statements for bank accounts, brokerage accounts, and life insurance policies.

Documentation of all liabilities and potential deductions is also crucial for accurate tax calculation. This includes records of funeral expenses, administration expenses incurred during the estate settlement process, outstanding debts, and mortgage details. Information related to charitable bequests and details for any property passing to a surviving spouse for the marital deduction must also be gathered. Records of any taxable gifts made by the decedent during their lifetime are required.

Submitting the Return

Once Form 706 is thoroughly prepared and all supporting documentation is compiled, the return must be submitted to the Internal Revenue Service. The most common method of submission involves mailing the completed form to the specific IRS address designated for estate tax returns. It is generally advisable to use certified mail with a return receipt to confirm delivery and establish proof of timely filing.

While electronic payment options, such as the Electronic Federal Tax Payment System (EFTPS), are available for remitting any estate tax due, Form 706 itself is typically filed by mail. After submission, the estate should retain copies of the filed return and all accompanying documents for its records.