United States Estate (and Generation-Skipping Transfer) Tax Return

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Instructions for
Form 706-GS(D-1)
(Rev. November 2025)

Use with the August 2025 revision of Form 706-GS(D-1)
Notification of Distribution From a Generation-Skipping Trust
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-1) and its instructions, such as legislation
enacted after they were published, go to IRS.gov/Form706GS(D-1).

What’s New
Part I, General information. Entry lines in this section were
reorganized. Lines 1b and 2b were modified to include TIN as
trust's identification number.

General Instructions
Purpose of Form

A trustee uses Form 706-GS(D-1) to report certain
distributions from a trust that are subject to the generationskipping transfer (GST) tax and to provide the skip person
distributee with information needed to figure the tax due on
the distribution.

Who Must File

In general, the trustee of any trust that makes a taxable
distribution must file a Form 706-GS(D-1) for each skip
person. See Distributions Subject to GST Tax, later, for a
discussion of what constitutes a taxable distribution. The
trustee must file a return for each skip person even if the
inclusion ratio applicable to the distribution is zero. See
Column (d). Inclusion Ratio, later.

When to File

The trustee must file Copy A of Form 706-GS(D-1) with the
IRS and send Copy B to the distributee by April 15th of the
year following the calendar year when the distribution was
made. If the due date falls on a Saturday, Sunday, or legal
holiday, file on the next business day.

Where To File

The trustee must send Copy A of Form 706-GS(D-1) to the
following address:
Department of the Treasury
Internal Revenue Service Center
Stop 824G
7940 Kentucky Drive
Florence, KY 41042-2915
to:

If using a private delivery service, send Form 706-GS(D-1)

May 12, 2025

Internal Revenue Service Center
Stop 824G
7940 Kentucky Drive
Florence, KY 41042-2915

Trusts
Nonexplicit trusts. An arrangement that has substantially
the same effect as a trust will be treated as a trust even
though it is not an explicit trust. Examples of such
arrangements are insurance and annuity contracts,
arrangements involving life estates and remainders, and
estates for years.
In general, a transfer of property in which the identity of the
transferee is conditioned on the occurrence of an event is a
transfer in trust. However, this rule does not apply to a
testamentary trust if the event is to occur within 6 months of
the transferor’s date of death.
Nonexplicit trusts do not include decedents’ estates.
In the case of a nonexplicit trust, the person in actual or
constructive possession of the property involved is
considered the trustee and is liable for filing Form
706-GS(D-1).
If you are filing this return for a nonexplicit trust, see
Line 2b. Trust's Taxpayer Identification Number, later.
Separate trusts. You must treat the following as separate
trusts:
• Portions of a trust that are attributable to transfers from
different transferors and
• Substantially separate and independent shares of
different beneficiaries in a trust.
You must report such separate trusts under different item
numbers in column (a) of line 3, even if they have the same
inclusion ratios.

Distributions Subject to GST Tax

In general, all taxable distributions are subject to the GST tax.
A taxable distribution is any distribution from a trust to a skip
person (other than a taxable termination or a direct skip).
If any GST tax imposed on a distribution is paid out of the
trust from which the distribution was made, the amount of tax
paid by the trust is also a taxable distribution.
A distribution is not considered a taxable distribution if,
had it been made while an individual was alive, it would have
been a nontaxable gift because of section 2503(e) (relating to
transfers made for certain educational or medical expenses).
Also, a distribution (or any portion thereof) is not a taxable
distribution to the extent that:
• The property distributed was previously subject to GST
tax and

Instructions for Form 706GS(D-1) (Rev. 11-2025) Catalog Number 10926L
Department of the Treasury Internal Revenue Service www.irs.gov

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• The distributee in the prior distribution is assigned to a

generation the same as or lower than the distributee in
the current distribution.

This rule does not apply if the transfers have the effect of
avoiding GST tax for any transfer.

Exceptions
Irrevocable trusts. The GST tax does not apply to any
distribution from a trust that was irrevocable on September
25, 1985. Any trust in existence on September 25, 1985, will
be considered irrevocable unless:
• On September 25, 1985, the value of the trust could have
been included in the settlor’s gross estate for federal
estate tax purposes by reason of section 2038 if the
settlor had died on September 25, 1985, or
• Regarding a policy of life insurance that is treated as a
trust under section 2652(b), the insured was an owner on
September 25, 1985, and this would have caused the
insurance proceeds to be included in the insured’s gross
estate for federal estate tax purposes if the insured had
died on September 25, 1985.
For more information, see Regulations section
26.2601-1(b).
Trusts containing qualified terminable interest property.
If an irrevocable trust in existence on September 25, 1985,
holds qualified terminable interest property (QTIP) (as
defined in section 2056(b)(7)) as a result of an election under
section 2056(b)(7) or 2523(f), the trust may elect to be
treated for purposes of the GST tax as if the QTIP election
had not been made. Thus, transfers from such a trust will not
be subject to the GST tax.
Additions to irrevocable trusts. To the extent that a
distribution from a trust is from an addition to an irrevocable
trust made after September 25, 1985, such distribution is
subject to the GST tax. Additions include constructive
additions described in Regulations section 26.2601-1(b)(1)
(v).
For purposes of figuring the inclusion ratio (defined later),
use only the value of the total additions made to the trust after
September 25, 1985.
Distributions from trusts to which additions have been
made. As described earlier, when an addition is made after
September 25, 1985, to an irrevocable trust, only the portion
of the trust resulting from the addition is subject to the GST
tax. For distributions, this portion is the product of the
allocation fraction and the value of the property distributed
(including accumulated income and appreciation on that
property).
The allocation fraction is a fraction, the numerator of which
is the value of the addition as of the date it was made
(regardless of whether it was subject to gift or estate tax, but
reduced by the amount of federal or state estate or gift tax
imposed and paid by the trust). The denominator of the
fraction is the fair market value of the entire trust immediately
after the addition, less any trust amount that is similar to
expenses, indebtedness, or taxes that would be allowable as
a deduction under section 2053, and further reduced by the
same amount that the numerator was reduced by to reflect
federal or state estate or gift taxes paid by the trust.
When there is more than one addition, the allocation
fraction is revised after each addition. The numerator of the
revised fraction is the sum of:
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1. The value of the trust subject to the GST tax immediately
before the last addition and
2. The amount of the latest addition.
The denominator of the revised fraction is the total value of
the entire trust immediately after the latest addition. If the
addition results from a generation-skipping transfer, reduce
the numerator and denominator by the amount of any GST
tax imposed on the transfer and recovered from the trust.
Round off the allocation fraction to five decimal places (for
example, “0.00001”).

Transition Rule for Revocable Trusts

The GST tax will not apply to any distributions from a
revocable trust, provided:
1. The trust was executed before October 22, 1986;
2. The trust as it existed on October 21, 1986, was not
amended after October 21, 1986, in any way that created
or increased the amount of a generation-skipping
transfer;
3. Except as provided later, no addition was made to the
trust; and
4. The settlor died before January 1, 1987.
A revocable trust is any trust that on October 22, 1986,
was not an irrevocable trust (as defined earlier) and would
not have been an irrevocable trust had it been created before
September 25, 1985.
The instructions under Trusts containing qualified
terminable interest property apply also to revocable trusts
covered by these transition rules.
Amendments to revocable trusts. An amendment to a
revocable trust in existence on October 21, 1986, will not be
considered to result in the creation of or an increase in the
amount of a generation-skipping transfer where:
• The amendment is administrative or clarifying in nature;
or
• It is designed to perfect a marital or charitable deduction
for an existing transfer, and it only incidentally increases
the amount transferred to a skip person.
Addition to revocable trusts. If an addition (including a
constructive addition) to a revocable trust is made after
October 21, 1986, and before the death of the settlor, all
subsequent distributions from the trust will be subject to the
GST tax, provided the other requirements of taxability are
met. For settlors dying before January 1, 1987, any addition
made to a revocable trust after the death of the settlor will be
treated as if made to an irrevocable trust.
See Regulations section 26.2601-1(b)(2)(vii) for examples
demonstrating the operation of these rules.

Transition Rule in Case of Mental Disability

If the settlor was under a disability on October 22, 1986, the
GST tax may not apply. See Regulations section
26.2601-1(b)(3) for a definition of the term “mental disability”
and details on the application of this rule.

Exceptions to Additions Rule

Do not treat as an addition to a trust any addition that is made
pursuant to an instrument or arrangement that is covered by
the rules discussed earlier under Transition Rule for
Revocable Trusts and Transition Rule in Case of Mental
Disability. This also applies to inter vivos transfers if the same

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property would have been added to the trust by such an
instrument. For examples illustrating this rule, see
Regulations section 26.2601-1(b)(4)(ii).

Governmental entities and certain charitable organizations
are assigned to the transferor’s generation. Distributions to
them will never be generation-skipping transfers.

Definitions

Generation assignment where intervening parent is deceased. If you made a gift or bequest to your grandchild and
at the time you made the gift or bequest, the grandchild’s
parent (who is your or your spouse’s or your former spouse’s
child) is deceased, then for purposes of generation
assignment, your grandchild will be considered to be your
child rather than your grandchild. Your grandchild’s children
will be treated as your grandchildren rather than your
great-grandchildren.
This rule is also applied to your lineal descendants below
the level of grandchild. For example, if your grandchild is
deceased, your great-grandchildren who are lineal
descendants of the deceased grandchild are considered your
grandchildren for purposes of the GST tax.
This rule also governs generation assignment for other
lineal descendants. For example, if property is transferred to
an individual who is a descendant of a parent of the
transferor, and that individual’s parent (who is a lineal
descendant of the parent of the transferor) is deceased at the
time the transfer is subject to gift or estate tax, then for
purposes of generation assignment, the individual is treated
as if they are a member of the generation that is one
generation below the lower of:
• The transferor’s generation or
• The generation assignment of the youngest living
ancestor of the individual, who is also a descendant of
the parent of the transferor.

Skip persons. For GST tax purposes, skip person means:
1. A natural person assigned to a generation that is two or
more generations below the settlor’s generation, or
2. A trust that meets the following conditions:
a. All interests in the trust are held by skip persons, or
b. No person holds an interest in the trust, and at no
time after the transfer to the trust may a distribution
be made to a non-skip person.
Non-skip person. A non-skip person is any person who is
not a skip person.
Generation assignment. A generation is determined along
family lines as follows:
1. Where the beneficiary is a lineal descendant of a
grandparent of the transferor (for example, the donor’s
cousin, niece, nephew, etc.), the number of generations
between the transferor and the descendant is
determined by subtracting the number of generations
between the grandparent and the transferor from the
number of generations between the grandparent and the
descendant.
2. Where the beneficiary is the lineal descendant of a
grandparent of a spouse (or former spouse) of the
transferor, the number of generations between the
transferor and the descendant is determined by
subtracting the number of generations between the
grandparent and the spouse (or former spouse) from the
number of generations between the grandparent and the
descendant.
3. For this purpose, a relationship by adoption is
considered a blood relationship. A relationship by
half-blood is considered a relationship by whole blood.
4. The spouse or former spouse of a transferor or lineal
descendant is considered to belong to the same
generation as the transferor or lineal descendant, as the
case may be.
A person who is not assigned to a generation according to
the rules above is assigned to a generation based on their
birth date as follows.
1. A person who was born not more than 121/2 years after
the transferor is in the transferor’s generation.
2. A person born more than 121/2 years, but not more than
371/2 years, after the transferor is in the first generation
younger than the transferor.
3. Similar rules apply for a new generation every 25 years.
If more than one of the rules for assigning generations
applies to a beneficiary, the beneficiary is generally assigned
to the youngest of the generations that apply.
If an entity such as a partnership, corporation, trust, or
estate has an interest in the property, each individual who
has a beneficial interest in the entity is treated as having an
interest in the property. The individual is then assigned to a
generation using the rules described above.

The same rules apply to the generation assignment of any
descendant of the individual.
This rule does not apply to a transfer to an individual who
is not a lineal descendant of the transferor if the transferor
has any living lineal descendants.
If any transfer of property to a trust would have been a
direct skip except for this generation assignment rule, then
the rule also applies to transfers from the trust attributable to
such property.
Ninety-day rule. For purposes of determining if an
individual’s parent is deceased at the time of a testamentary
transfer, an individual’s parent who dies no later than 90 days
after a transfer occurring by reason of the death of the
transferor is treated as having predeceased the transferor.
The 90-day rule applies to transfers occurring on or after July
18, 2005. See Regulations section 26.2651-1 for more
information.
Multiple skips. If after a generation-skipping transfer the
property transferred is held in trust, then for the purpose of
determining the taxability of subsequent distributions from
the trust involving that property, the settlor of the property is
assigned to the first generation above the highest generation
of any person who has an interest in the trust immediately
after the initial transfer.

Signature

The trustee, or an authorized representative of the trustee,
must sign Form 706-GS(D-1).

If someone prepares your return and does not charge you,
that person should not sign the return. Generally, anyone who
is paid to prepare your return must sign it in the space
indicated.

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Specific Instructions

• Exact name of corporation;
• Principal exchange upon which sold, if listed on an

Part I—General Information

• CUSIP number.

Line 1b. Skip Person Distributee’s Taxpayer
Identification Number

•
•
•
•
•
•
•

Enter the social security number of an individual distributee.
(If the number is unknown or the individual has no number,
indicate “unknown” or “none.”) If the distributee is a trust,
enter the trust’s taxpayer identification number (TIN).

Line 2b. Trust’s Taxpayer Identification Number

Enter the TIN of the trust from which the distribution was
made.

A nonexplicit trust, as described under Who Must File,
must have a TIN that is separate from any other entity’s TIN
and that will be used only by the nonexplicit trust.
A trust or nonexplicit trust that does not have a TIN should
apply for one. For additional information, visit IRS.gov/TIN.
Send the appropriate TIN form to the address listed under
Where To File. If the TIN has not been received by the filing
time for the GST form, write “Applied for” on line 2b.

Part II—Distributions

Report all taxable distributions made during the year from the
trust listed on line 2 to the skip person distributee listed on
line 1. Report a distribution even if its inclusion ratio is zero.

Column (a). Item Number.

Assign consecutive numbers to each distribution made
during the year. Different items of property having different
inclusion ratios must be listed separately in Part II. Include
under a single item number any properties having the same
inclusion ratio even if they were distributed at different times.
An exception to this is distributions from “separate trusts” as
that term was defined earlier. You must report distributions
from such separate trusts under different item numbers even
if they have the same inclusion ratio.

Column (b). Description of Property

exchange; and

For bonds, give:
Quantity and denomination;
Name of obligor;
Date of maturity;
Interest rate;
Interest due date;
Principal exchange, if listed on an exchange; and
CUSIP number.

If the stock or bond is unlisted, show the company’s
principal business office.
The CUSIP (Committee on Uniform Security Identification
Procedure) number is a nine-digit number that is assigned to
all stocks and bonds traded on major exchanges and many
unlisted securities. Usually the CUSIP number is printed on
the face of the stock certificate. If the CUSIP number is not
printed on the certificate, it may be obtained through the
company’s transfer agent.
Other personal property. Any personal property distributed
must be described in enough detail that the IRS can value it.

Column (d). Inclusion Ratio

Note. The trustee must provide the inclusion ratio for every
distribution.
All distributions, or any part of a single distribution, that
have different inclusion ratios must be listed as separate
items in column (a).
The inclusion ratio is the excess of 1 over the applicable
fraction determined for the trust from which the distribution
was made.

Applicable fraction. The applicable fraction is a fraction,
the numerator of which is the amount of the GST exemption
allocated to the trust. The denominator of the fraction is:
1. The value of the property transferred to the trust, minus
2. The sum of:
a. Any federal estate tax or state death tax actually
recovered from the trust attributable to the property
and

Real estate. Describe the real estate in enough detail so
that the IRS can easily locate it for inspection and valuation.
For each parcel of real estate, report the location and, if the
parcel is improved, describe the improvements. For city or
town property, report the street number, ward, subdivision,
block and lot, etc. For rural property, report the township,
range, landmarks, etc.

Round the applicable fraction to at least the nearest
one-thousandth (for example, “0.001”).

Stocks and bonds. For stocks, give:
• Number of shares;
• Whether common or preferred;
• Issue;
• Par value where needed for valuation;
• Price per share;

Numerator (GST exemption). Every individual settlor is
allowed a lifetime GST exemption to be allocated against
property that the individual has transferred. For
generation-skipping transfers made through 1998, the
exemption was $1 million. The GST exemption amounts
thereafter are as follows:

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b. Any charitable deduction allowed under section 2055
or 2522 with respect to the property.

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Year
1999 . . . .
2000 . . . .
2001 . . . .
2002 . . . .
2003 . . . .
2004 and 2005
2006–2008 .
2009 . . . .
2010 and 2011
2012 . . . .
2013 . . . .
2014 . . . .
2015 . . . .
2016 . . . .
2017 . . . .
2018 . . . .
2019 . . . .
2020 . . . .
2021 . . . .
2022 . . . .
2023 . . . .
2024 . . . .
2025 . . . .

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Amount
$1,010,000
$1,030,000
$1,060,000
$1,100,000
$1,120,000
$1,500,000
$2,000,000
$3,500,000
$5,000,000
$5,120,000
$5,250,000
$5,340,000
$5,430,000
$5,450,000
$5,490,000
$11,180,000
$11,400,000
$11,580,000
$11,700,000
$12,060,000
$12,920,000
$13,610,000
$13,990,000

The GST exemption amount is subject to an annual
inflation adjustment for calendar years after 2025. See Rev.
Proc. 2024-40, 2024-45 I.R.B. 1100, for information about
calendar year 2025. Changes to the annual inflation adjusted
amounts in later years will be included in a future revenue
procedure.
A valid Deceased Spousal Unused Exclusion
Amount (“DSUE ” or portability) election by an
CAUTION executor of a deceased spouse’s estate does not
apply to or impact GST tax exemption.

!

For existing trusts, transferors may allocate the additional
GST exemption amount attributable to section 2631(c)
increases if they otherwise qualify under the existing rules for
late allocations. For more information, see section 2632 and
Multiple transfers into a trust., later.
Once made, allocations are irrevocable.
Allocation of the GST exemption is made by the settlor on
Form 709, United States Gift (and Generation-Skipping
Transfer) Tax Return, and/or Form 706, United States Estate
(and Generation-Skipping Transfer) Tax Return, by the
executor of the settlor’s estate. Therefore, you should obtain
information regarding the allocation of the exemption to this
trust from the settlor or the executor of the settlor’s estate, as
applicable.
If the settlor’s entire GST exemption is not allocated by the
due date (including extensions) of the settlor’s estate tax
return, the exemption is automatically allocated under the
rules of section 2632.
Transfers subject to an estate tax inclusion period. If a
transferor made an inter vivos transfer, and the property
transferred would have been includible in the transferor’s
estate if they had died immediately after the transfer (other
than by reason of the transferor dying within 3 years of
making the gift), for purposes of determining the inclusion
ratio, an allocation of GST exemption will only become
effective at the close of the estate tax inclusion period (ETIP).
The value of the property for the purpose of figuring the
inclusion ratio is the estate tax value if the property is
included in the transferor’s gross estate, or its value at the
close of the ETIP.
The ETIP closes at the earliest of:

1. The time the transferred property would no longer be
includible in the settlor’s estate,
2. The date of a generationskipping transfer of the property, or
3. The date of death of the settlor.
Denominator (valuation of trust assets). In general, the
value to be used in the applicable fraction is the gift tax value
for an inter vivos transfer as long as the allocation of the GST
exemption was made on a timely filed gift tax return. The
value of a testamentary transfer is generally the estate tax
value.
If the allocation of the exemption to an inter vivos transfer,
made before January 1, 2001, is not made on a timely filed
gift tax return, the value for purposes of the applicable
fraction is the value of the property transferred at the time the
allocation is filed with the IRS.
Qualified terminable interest property. For qualified
terminable interest property (QTIP) that is included in the
estate of the surviving spouse of the settlor because of
section 2044, unless a special QTIP election has been made
under section 2652(a)(3), the surviving spouse is considered
the transferor under section 2652(a) for GST purposes, and
the value is the estate tax value in the estate of the surviving
spouse.
A special QTIP election allows property for which a QTIP
election was made for estate or gift tax purposes to be
treated for GST tax purposes as if this QTIP election had not
been made. If the special QTIP election has been made, the
predeceased settlor spouse is the transferor and the value is
that spouse’s estate or gift tax value under the rules
described above. Either the settlor spouse or the executor of
the settlor spouse’s estate must make the special QTIP
election.
ETIP. If an individual could not make a timely allocation of
exemption because of an ETIP, the value of the property for
the purpose of computing the inclusion ratio is the estate tax
value if the property is includible in the transferor’s gross
estate. If the property is not includible in the transferor’s gross
estate, the property is valued at the close of the ETIP,
provided that the GST exemption is allocated on a timely filed
gift tax return for the calendar year in which the ETIP closes.
Multiple transfers into a trust. When a transfer is made to
a pre-existing trust, the applicable fraction must be
recomputed. The numerator of the new fraction is the sum of:
1. The exemption allocated to the current transfer and
2. The nontax portion of the trust immediately before the
current transfer (the product of the applicable fraction
and the value of all of the property in the trust
immediately before the current transfer).
The denominator of the new fraction is the sum of:
1. The value of the current transfer (minus any federal
estate tax or state death tax actually paid by the trust
attributable to such property) and any charitable
deduction allowed with respect to such property and
2. The value of all property in the trust immediately before
the current transfer.
Charitable lead annuity trusts. For distributions from a
charitable lead annuity trust, the numerator of the applicable
fraction is the adjusted GST exemption, as defined below.
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The denominator is the value of the trust immediately after
termination of the charitable lead annuity.
The adjusted GST exemption is the sum of:
1. The exemption allocated to the trust and
2. Interest on the exemption determined at the interest rate
used to figure the estate or gift deduction for the
charitable lead annuity and for the actual period of the
charitable lead annuity.
In the case of a late allocation, the amount of interest
accrued prior to the date of allocation is zero.

Column (e). Value

Enter the value of the property distributed from the trust at the
time of distribution.

Part III—Trust Information
Line 4

An arrangement that has substantially the same effect as a
trust will be treated as a trust even though it is not an explicit

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trust. Examples of such arrangements are insurance and
annuity contracts, arrangements involving life estates and
remainders, and estates for years. Nonexplicit trusts do not
include decedent’s estates.
In the case of a nonexplicit trust, the trustee is the person
in actual or constructive possession of the property involved.

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Whenever property is transferred into a pre-existing trust, the
inclusion ratio must be refigured. See Multiple transfers into a
trust for the rule on how to refigure the inclusion ratio.