The IRS has released drafts of Form 706, United States Estate (and Generation-Skipping Transfer) Tax Return for estates of decedents dying after Dec. 31, 2009 and before Jan. 1, 2011, and its instructions. They reflect law changes made by the Tax Relief, Unemployment Insurance Reauthorization and Job Creation Act of 2010 (2010 Tax Relief Act), as well as indexing and other changes. Form 706 must be filed by the executor of any estate of a decedent dying in 2010 whose gross estate, plus adjusted taxable gifts and specific exemption is more than $5,000,000. Alternatively, for decedents dying in 2010, the estate may elect not have the estate tax apply, but rather to apply modified carryover basis treatment to property acquired or passing from the decedent. If such election is made, the executor would not file a Form 706, but rather the IRS has indicated that such election will be made on Form 8939, Allocation of Increase in Basis for Property Acquired From a Decedent, which currently is available only in draft form. Earlier this year, IRS said that it plans to issue future guidance that will provide a deadline for filing Form 8939 and for electing to have the estate tax rules not apply to the estates of persons who died in 2010, but such guidance is still forthcoming. The draft instructions state that for estates of decedents dying between Jan. 1, 2010 and Dec. 16, 2010, the due date for filing Form 706 and payment of estate and GST taxes is Sept.19, 2011. The applicable exclusion amount is $5 million and the maximum estate tax rate is 35%. The applicable rate for generation-skipping transfers (GSTs) is zero.