Estate received extension for omitted QTIP election

Plain-English summary

A decedent's trust created a marital farm trust that paid all income to the surviving spouse for life. The estate hired a tax professional to prepare Form 706 and make necessary elections, but the professional mistakenly listed the trust assets as other property rather than property subject to the QTIP election. After discovering the omission, the estate filed a supplemental return. Because the estate reasonably relied on a qualified tax professional and otherwise satisfied the regulatory standards, the IRS extended the election deadline to the date of the supplemental filing.

Ruling snapshot

• Question: Could an estate receive additional time to make a QTIP election omitted from its timely Form 706 because of its tax professional's error?
• Outcome: Relief granted
• Key authorities: IRC § 2056(b)(7); Treas. Reg. §§ 20.2056(b)-7, 301.9100-1, 301.9100-3

Full text (IRS public release)

Internal Revenue Service Department of the Treasury
Washington, DC 20224

Number: 202538019 Third Party Communication: None
Release Date: 9/19/2025 Date of Communication: Not Applicable
Index Number: 2056.07-00, 9100.00-00
Person To Contact:
---------------------------------- ---------------------, ID No. -----------------
----------------------------------- Telephone Number:

---------------------------- Refer Reply To:
--------------------------- CC:PT&E:B04
PLR-122553-24
Date:
------------------------------------------------------ June 16, 2025

Legend

Decedent = ----------------------------

Spouse = --------------------

Trust = ---------------------------------------------------------------------------------

---------------------------------------------

Tax Professional = -----------------------------
House and Farm = ---------------------------------------------------------------------------------

Date1 = ------------------
Date 2 = -----------------------
Date 3 = ------------------------
Date 4 = -------------------
Date 5 = -----------------------
x = ---------------

Dear ------------------------------------------------------------:

This letter responds to a letter from your authorized representative dated December 5,
2024, and subsequent correspondence, requesting an extension of time under
§§ 301.9100-1 and 301.9100-3 of the Procedure and Administration Regulations to
make a qualified terminable interest property (QTIP) election under § 2056(b)(7) of the
Internal Revenue Code (Code).

PLR-122553-24 2

The facts and representations submitted are summarized as follows:

Decedent created Trust, a revocable trust, on Date 1, and amended Trust on Date 2.
On Date 3, Decedent died survived by Spouse. Trust became irrevocable upon
Decedent’s death. Upon Decedent’s death, Paragraph Sixth establishes Marital Farm
Trust.

Under Paragraph Sixth of Trust, as amended, if Spouse survives Decedent, then
upon Decedent’s death, Trustees are to fund Marital Farm Trust with cash, securities
and/or other property (to be selected by Trustees only out of assets which qualify
for the marital deduction provided for by the Code) having a value equal to $x.

Trustees are directed to pay the net income of Marital Farm Trust, at least quarterly, to
Spouse for life. Trustees may also make discretionary distributions of principal to
Spouse as they deem necessary to pay for all utilities, real estate taxes or special
assessments, property and casualty insurance, repairs, maintenance costs, operating
expenses, or other expenses related to the maintenance, upkeep, and operation of
House and Farm, after taking into account the income payable to Spouse from Marital
Farm Trust. Further, Spouse has the right to require Trustees to make unproductive
trust property productive or dispose of it and invest the proceeds in productive
property within a reasonable time.

The executors of Decedent's estate engaged Tax Professional to prepare Decedent's
Form 706 (United States Estate (and Generation-Skipping Transfer) Tax Return) and to
make any necessary elections, including the QTIP election. The Form 706 for
Decedent’s estate was timely filed on Date 4; however, in Part A of Schedule M, Tax
Professional mistakenly failed to include the assets of Marital Farm Trust as property
subject to the QTIP election and instead listed such property as “[a]ll other property.”
Thus, no QTIP election was made with respect to the property passing to Marital Farm
Trust. Upon discovery that no QTIP election had been made, Decedent’s estate filed a
supplemental Form 706 on Date 5 to make the QTIP election.

You have requested an extension of time to make the QTIP election under § 2056(b)(7).

LAW AND ANALYSIS

Section 2001(a) imposes a tax on the transfer of the taxable estate of every decedent
who is a citizen or resident of the United States.

Section 2056(a) provides that, for purposes of the tax imposed by § 2001, the value of
the taxable estate shall, except as limited by § 2056(b), be determined by deducting
from the value of the gross estate an amount equal to the value of any interest in
property which passes or has passed from the decedent to the surviving spouse, but
only to the extent that such interest is included in determining the value of the gross
estate.

PLR-122553-24 3

Section 2056(b)(7)(A) provides that, in the case of qualified terminable interest property,
for purposes of § 2056(a), such property shall be treated as passing to the surviving
spouse, and for purposes of § 2056(b)(1)(A), no part of such property shall be treated
as passing to any person other than the surviving spouse.

Section 2056(b)(7)(B)(i) defines the term “qualified terminable interest property” as
property: (I) which passes from the decedent; (II) in which the surviving spouse has a
qualifying income interest for life as defined in § 2056(b)(7)(B)(ii); and (III) to which an
election under § 2056(b)(7) applies.

Section 2056(b)(7)(B)(ii) provides that the surviving spouse has a qualifying income
interest for life if: (I) the surviving spouse is entitled to all the income from the property,
payable annually or at more frequent intervals, or has a usufruct interest for life in the
property; and (II) no person has a power to appoint any part of the property to any
person other than the surviving spouse.

Section 2056(b)(7)(B)(v) provides that an election under § 2056(b)(7) with respect to
any property shall be made by the executor on the return of tax imposed by § 2001.
Such an election, once made, shall be irrevocable.

Section 20.2056(b)-7(b)(4)(i) provides that, in general, the election referred to in
§ 2056(b)(7)(B)(i)(III) and (v) is made on the return of tax imposed by § 2001 (or
§ 2101). For purposes of this paragraph, the term “return of tax imposed by § 2001”
means the last estate tax return filed by the executor on or before the due date of the
return, including extensions or, if a timely return is not filed, the first estate tax return
filed by the executor after the due date.

Section 301.9100-1(c) provides that the Commissioner has discretion to grant a
reasonable extension of time under the rules set forth in §§ 301.9100-2 and 301.9100-3
to make a regulatory election, or a statutory election (but no more than six months
except in the case of a taxpayer who is abroad), under all subtitles of the Code except
subtitles E, G, H, and I.

Section 301.9100-3 provides the standards used to determine whether to grant an
extension of time to make an election whose date is prescribed by a regulation (and not
expressly provided by statute).

Requests for relief under § 301.9100-3 will be granted when the taxpayer provides the
evidence to establish to the satisfaction of the Commissioner that the taxpayer acted
reasonably and in good faith, and that granting relief will not prejudice the interests of
the government.

Section 301.9100-3(b)(1)(v) provides that a taxpayer is deemed to have acted
reasonably and in good faith if the taxpayer reasonably relied on a qualified tax

PLR-122553-24 4

professional, including a tax professional employed by the taxpayer, and the tax
professional failed to make, or advise the taxpayer to make, the election.

Based on the facts submitted and the representations made, we conclude that the
requirements of § 301.9100-3 have been satisfied. Accordingly, the executors of
Decedent’s estate are granted an extension of time to Date 5, the date the
supplemental Form 706 was filed, to make a QTIP election with respect to the assets of
Marital Farm Trust. A copy of this letter along with a copy of the filed supplemental
Form 706 should be forwarded to: Department of the Treasury, Internal Revenue
Service, Stop 824G, 7940 Kentucky Drive, Florence, KY 41042-2915.

Except as expressly provided herein, no opinion is expressed or implied concerning the
tax consequences of any aspect of any transaction or item discussed or referenced in
this letter. Specifically, we express or imply no opinion on whether Decedent’s estate
qualifies for the deduction under 2056(b)(7) with respect to Marital Farm Trust.

This ruling is directed only to the taxpayer requesting it. Section 6110(k)(3) of the Code
provides that it may not be used or cited as precedent.

The rulings contained in this letter are based upon information and representations
submitted by the taxpayer and accompanied by a penalty of perjury statement executed
by an appropriate party. While this office has not verified any of the material submitted
in support of the request for rulings, it is subject to verification on examination.

In accordance with the Power of Attorney on file with this office, we have sent a copy of
this letter to your authorized representatives.

Sincerely,

Associate Chief Counsel
Passthroughs, Trusts & Estates

By: _________
Karlene M. Lesho
Chief, Branch 4
Office of the Associate Chief Counsel
(Passthroughs, Trusts & Estates)

Enclosure (1)

Copy for § 6110 purposes

PLR-122553-24 5

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