Question

An estate tax return (Form 706) is due:

a. 90 days from date of death.
b. 9 months from date of death.
c. By April 15th of the year following date of death.
d. Within a reasonable time based on the size and complexity of the estate.

Answer 1

The estate tax return, Form 706, is due 9 months after the date of death. It is distinct from the personal income tax return deadline in mid-April. The estate tax applies to significant transfers of wealth in the form of inheritance, with the 2015 exemption limit set at estates above $5.43 million.

Step-by-step explanation:

An estate tax return (Form 706) is due nine months from the date of death. While U.S. citizens and residents are required to file an income tax form by the middle of April every year, this deadline does not apply to the estate tax return. The estate tax in the United States is a tax imposed on the value of an inheritance, aiming to limit the transfer of large amounts of wealth. For instance, in 2015, the tax applied only to estates above $5.43 million, affecting a small percentage of the population with high levels of wealth.

As a federal tax, the estate tax is concerned with property transfers after death. This ensures that larger estates contribute to government revenues, which finance government purchases of goods and services, while smaller estates, under the threshold amount, are exempt.