Clients rely on your expertise when Form 706 gets complicated

When a client passes, the estate work that follows can feel like unfamiliar territory. But when you understand how to approach Form 706, you become the trusted guide families need.

Below, you’ll find a few of the top questions from a recent webinar on the topic and their corresponding answers. If you choose to attend the on-demand version of this webinar, you can access the full recording and the entire list of Q&As.    

Q: Does every estate need to file Form 706, United States Estate (and Generation-Skipping Transfer) Tax Return, after a taxpayer passes away?
A: No. Form 706 is only required if the decedent’s gross estate, plus adjusted taxable gifts and specific exemptions, exceeds the federal filing threshold ($13.99 million for 2025). Smaller estates may still file Form 706 to elect portability of the deceased spouse’s unused exclusion (DSUE) or establish basis in an asset.

Q: Is a surviving spouse required to file Form 706 to preserve portability of the deceased spouse’s unused exclusion?
A: Yes. To elect portability of the DSUE, the executor must timely file Form 706, even if the estate is not otherwise required to file. This allows the surviving spouse to apply the DSUE to future gift or estate tax liabilities.

Q: If an estate has no tax liability, is a real estate appraisal still required to file Form 706 for portability purposes?
A: Yes. Even for portability-only filings, reasonable estimates of asset values must be used and supporting documentation such as appraisals may be required. IRS guidance (Rev. Proc. 2022-32) allows simplified reporting for small estates electing portability.

Q: Can Form 706 be late and still make the portability election?
A: Generally, Form 706 must be filed within nine months of the date of death (or 15 months with an extension). However, Rev. Proc. 2022-32 provides a simplified method to file late returns within five years solely to elect portability if the estate wasn’t required to file originally.

To learn more about Form 1041, you can watch our on-demand webinar. NATP members can attend for free, depending on membership level! If you’re not an NATP member and want to learn more, join our completely free 30-day trial.