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Yes, specific non-charitable bequests in wills are included on federal form 706. The inclusion of such bequests is part of the broader process of determining the taxable estate for estate tax purposes. Federal form 706, known as the "United States Estate (and Generation-Skipping Transfer) Tax Return," is used to calculate the estate tax due based on the decedent's gross estate and allowable deductions.
The Internal Revenue Code § 2053 provides the framework for deductions from the gross estate, which includes expenses, indebtedness, and taxes, to arrive at the value of the taxable estate. While § 2053 primarily focuses on deductions for funeral expenses, administration expenses, claims against the estate, and unpaid mortgages or indebtedness, it does not explicitly exclude non-charitable bequests from the gross estate. Instead, the value of the taxable estate is determined by deducting allowable amounts from the value of the gross estate, which inherently includes all assets and bequests, both charitable and non-charitable.
Furthermore, the excerpts from § 2106 and related technical advice memorandums (TAMs) and notices provide additional context on deductions and the treatment of bequests for nonresident aliens and specific conditions under which deductions are allowed or disallowed. However, these sections and documents primarily address the treatment of charitable bequests and deductions related to them, rather than explicitly detailing the inclusion of non-charitable bequests.
Given the comprehensive nature of federal form 706 in reporting the decedent's gross estate and calculating the estate tax due, all assets and bequests, including specific non-charitable bequests, must be accounted for on the form. The form serves as a complete accounting of the decedent's estate, from which allowable deductions are then subtracted to determine the taxable estate. Therefore, specific non-charitable bequests, as part of the decedent's gross estate, are included on federal form 706.
Sources:
ECC 201216037
Notice 2009-84
TAM 199925043
§ 2106. Taxable estate
TAM 9135003
§ 2053. Expenses, indebtedness, and taxes
