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CRT inclusion on 706 Expand / Collapse
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Anonymous
Posted 1/11/2007 2:31:39 PM




I have a situation that I'm not certain how to report on a 706. It's mainly a reporting question and the impact on the 706 is $0 in tax.

A client established a charitable remainder trust a few years back and received quarterly payments during his lifetime. On passing, the remainder interest goes to charities.

On the 706 should I include the remainder interest on Schedule G and then deduct the same remainder interest on Schedule O, or should I just not include on either schedule as his interest in the trust terminated upon his death?

Simple question, no?
Post #304
Posted 1/11/2007 4:06:10 PM
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My understanding is you have to report the date of death fair market value of the trust assets on schedules G and O.
Post #305
Posted 1/11/2007 4:06:34 PM
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I haven't had your exact situation. I've reported on 706 a charitable remainder trust where the surviving spouse continues as an income beneficiary. Then you recalcuate the remainder interest based on current values in the trust.

However, since you must disclose any trusts that the decedent created or was the beneficiary of, the simplest way of complying would be to report it as you've suggested. I'd put the trust assets on Schedule G and the offsetting deduction on O.

Mary Kay Foss

Post #306
Anonymous
Posted 1/11/2007 5:03:59 PM




The charitable remainder trust is included in the estate under Sect 2036 (& reported in Sch G) because your client made a transfer while retaining an income interest. If your client was married when the trust was established and community funds were gifted, only your client's 50% of the trust would be included.
Post #307
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