This field is only used for returns with a Date of Death prior to 2005. Line 14 (Field 02BSD) was deleted along with Line 13 (Fields 02TBA and 02SDC) after Tax Year 2004.

This field is transcribed from Page 1, Part 2, Line 14 (Tax Years 2002 through 2004) of the return. It is computed by subtracting Page 1, Part 2, Line 13 from Line 12 (Fields 02TBA and 0212).

Every state imposes some sort of tax on assets transferred at death. This can take the form of an estate tax (the estate pays tax on assets) or an inheritance tax (the heirs pay tax on what they receive), or both. A credit is allowed on these taxes paid against the federal estate tax up to certain percentage limitations. This field does the math to subtract the credit from the estate tax.

This field is only used on returns dated prior to Tax Year 2002. Line 7a was deleted, along with former Lines 7b, 7c, and 8 (Fields 02NTT, 02TNT, and 02TTT, respectively) after Tax Year 2001.

This field is transcribed from Page 1, Part 2, Line 7a of the (Tax Year 2001 and prior year) return. If Page 1, Part 2, Line 5 (Field 0205) exceeds $10,000,000, it shows the lesser of Page 1, Part 2, Line 5 (Field 0205) or the applicable phase out range (see below). This field is bypassed if Page 1, Line 5 (Field 0205) is $10,000,000 or less.

Prior to 2002, the benefits of the Unified Credit and taxes of less than the maximum tax were phased out for estates of more than $10,000,000. This was why we calculated Page 1, Part 2, Lines 7a, 7b, 7c and 8.

Depending on the maximum tax and Unified Credit in effect for the year of death, the phase out range changes. The phase out range ends at $17,184,000 for January 1, 1998, and subsequent years (through 2001), and at $21,040,000 ending December 31, 1997, and prior.

This field is only used on returns dated prior to Tax Year 2002. Line 7b was deleted, along with former Lines 7a, 7c, and 8 (Fields 02GTT, 02TNT, and 02TTT, respectively) after Tax Year 2001.

This field is transcribed from Page 1, Part 2, Line 7b of the (Tax Year 2001 and prior years) return. It is computed by subtracting $10,000,000 from Page 1, Part 2, Line 5 (Field 0205) or the applicable phase out range (see below). This field is bypassed if Page 1, Part 2, Line 5 (Field 0205) is $10,000,000 or less.

Prior to 2002, the benefits of the Unified Credit and taxes of less than the maximum tax were phased out for estates of more than $10,000,000. This was why we calculated Page 1, Part 2, Lines 7a, 7b, 7c and 8.

Depending on the maximum tax and Unified Credit in effect for the year of death, the phase out range changes. The phase out range ends at $17,184,000 for January 1, 1998, and subsequent years (through 2001), and at $21,040,000 ending December 31, 1997, and prior.

This field is only used on returns dated prior to Tax Year 2002. Line 7c was deleted, along with former Lines 7a, 7b, and 8 (Fields 02GTT, 02NTT, and 02TTT, respectively) after Tax Year 2001.

This field is transcribed from Page 1, Part 2, Line 7c of the return (for Tax Years 2001 and prior). The computer will math verify this field using 5% (.05) of the computer generated amount for Field 02NTT. This field is bypassed if Page 1, Part 2, Line 5 (Field 0205) is $10,000,000 or less.

Prior to 2002, the benefits of the Unified Credit and taxes of less than the maximum tax were phased out for estates of more than $10,000,000. This was why we calculated Page 1, Part 2, Lines 7a, 7b, 7c and 8.

Depending on the maximum tax and Unified Credit in effect for the year of death, the phase out range changes. The phase out range ends at $17,184,000 for January 1, 1998, and subsequent years (through 2001), and at $21,040,000 ending December 31, 1997, and prior.

This field is only used on returns dated prior to Tax Year 2002. Line 8 was deleted, along with former Lines 7a, 7b, and 7c (Fields 02GTT, 02NTT, 02TNT, respectively) after Tax Year 2001.

This field is transcribed from Page 1, Part 2, Line 8 of the return (Field 02TTT). It is the sum of Page 1, Part 2, Lines 6 and 7c (Fields 0206 and 02TNT). (This was previously Field 0208 and was transcribed from Line 8 (Tax Years 2001 and prior).)

Prior to 2002, the benefits of the Unified Credit and taxes of less than the maximum tax were phased out for estates of more than $10,000,000. This was why we calculated Page 1, Part 2, Lines 7a, 7b, 7c and 8.

Depending on the maximum tax and Unified Credit in effect for the year of death, the phase out range changes. The phase out range ends at $17,184,000 for January 1, 1998, and subsequent years (through 2001), and at $21,040,000 ending December 31, 1997, and prior.

The Error Record Format for Section 03 is listed as follows:

This field is only used for returns with dates of death prior to 2005. Line 15 (Field 03GTC) was deleted after Tax Year 2004.

This field is transcribed from Page 1, Part 2, Line 15 (Tax Years 2002 through 2004) of the return. (This was previously Line 17 and Field 0317 for Tax Years 2001 and prior.)

Generally, only taxable gifts given after December 31, 1976, are taken into account in computing the estate tax payable upon death. There is an exception, however. Gifts given prior to that date are included in the estate if the decedent retained an interest in the property given which does not cease at death.

Since the gift must be included in the estate and be subjected to the estate tax, a credit is given for any gift taxes paid to prevent double taxation.

This field is transcribed from Page 1, Part 2, Line 13.

Many foreign governments impose some sort of transfer tax on assets transferred after death. It can be an estate tax (tax paid by the estate), an inheritance tax (tax paid by heirs receiving the assets), or both. The United States taxes its citizens and resident aliens on their worldwide assets. The United States and many foreign countries also tax nonresident aliens on assets held within the taxing country. This can lead to double taxation. Since estate tax rates are often very high, double taxation can mean that assets are taxed by the 2 countries at a total rate of 100% or more. To prevent this from occurring to U.S. citizens and resident aliens, the United States gives a credit against U.S. estate taxes for foreign death taxes paid. (The credit is the lesser of U.S. Estate Tax paid or Foreign Tax paid on property subject to credit.)

This field is transcribed from Page 1, Part 2, Line 14.

If a taxpayer pays estate tax on a property given to an heir who dies from 2 years before to 10 years after the donors death (yes, you can leave property to someone already dead), a credit is available to the estate of the heir. It has been deemed unfair to subject the property to another estate tax when the property was held by the heir for such a short period of time.

This field is transcribed from Page 1, Part 2, Line 15. It is computed by adding Page 1, Part 2, Lines 13 and 14 (Fields 0313 and 0314).

These credits are added to reach a total which will be subtracted from the estate tax.

This field is transcribed from Page 1, Part 2, Line 16. It is computed by subtracting Page 1, Part 2, Line 15 from Line 12 (Fields 0315 and 0312).

This line performs the math to allow certain credits to be subtracted from the estate tax.

This field is transcribed from Page 1, Part 2, Line 17.

Generation-Skipping tax is the third type of transfer tax. It imposes tax at the maximum estate tax rate on certain transfers meant to avoid estate tax.

This field is transcribed from Page 1, Part 2, Line 18, with a year in the Date of Death of 1998 and later. It is computed by adding Page 1, Part 2, Lines 16 and 17 (Fields 0316 and 0317).

This field adds up the additions to estate tax.

This field is transcribed from Page 1, Part 2, Line 19.

This line may be filled in on amended returns or on a return with an extension with payment. It shows estate taxes previously paid.

This field is only used for returns with dates of death prior to 2005. Line 23 (Field 0323) was deleted after Tax Year 2004.

This field is transcribed from Page 1, Part 2, Line 23 (Tax Years 2002 through 2004) of the return.

U.S. Treasury Bonds can no longer be used to pay estate taxes.

If an amount is entered on Line 23, research BMFOL to determine if the amount has been credited to the estate.

This field is only used for returns with dates of death prior to 2005. Line 24 (Field 0324) was deleted after Tax Year 2004.

This field is transcribed from Page 1, Part 2, Line 24 (Tax Years 2002 through 2004) of the return. It is computed by adding Page 1, Part 2, Lines 22 and 23 (Fields 0322 and 0323).

This field adds payments made prior to filing the return.

This field is transcribed from Page 1, Part 2, Line 20. It is computed by subtracting Page 1, Part 2, Line 19 from Line 18 (Fields 0319 and 0318).

This field indicates if the estate owes money or is due a refund.

This field is only used if the decedent died prior to January 1, 1977, or if CCC "Y" applies. In these instances, the tax must be manually calculated.

This field is the manually computed amount of Total Transfer Taxes and will be entered only by Error Resolution. It is entered on the dotted portion of Page 1, Part 2, Line 18.

This field is transcribed from Page 1, Part 2, Line 23.

Schedule S was deleted for 1998 and subsequent years. It is still valid for 1997 and prior years. This Line 23 will still display on the ERS display screen as 03SEC for Tax Years 1998 and prior.

An additional tax is put on taxpayers with very large pensions, tax deferred annuities or Individual Retirement Accounts (IRAs) under certain conditions.