120-day extension to make QTIP and reverse-QTIP elections after an accountant's Schedule M error

Plain-English summary

When a spouse dies leaving property in a marital trust, the estate can
elect "qualified terminable interest property" (QTIP) treatment under
§ 2056(b)(7) so the property qualifies for the estate-tax marital
deduction, and a companion "reverse QTIP" election under § 2652(a)(3) so
the deceased spouse's generation-skipping tax exemption applies to it.
Here the estate's accountant timely filed the Form 706 but made a
mistake on Schedule M: the trust assets were reported as "All other
property" instead of in the QTIP section. As a result, neither the QTIP
election nor the reverse QTIP election was validly made. The estate asked
the IRS for relief under Treasury Regulation § 301.9100-3, which treats a
taxpayer as acting reasonably and in good faith when it relied on a
qualified tax professional who failed to make the election. The IRS
granted a 120-day extension to make both elections on an amended Form 706.
This matters because a reporting slip on the estate-tax return can
forfeit the marital deduction and GST planning, and § 9100 relief for
professional error is the standard fix.

Ruling snapshot

• Question: Should the IRS grant an extension of time to make a QTIP election (§ 2056(b)(7)) and a reverse QTIP election (§ 2652(a)(3)) that were missed due to a Schedule M reporting error?
• Outcome: Approved (120-day extension to make both elections on an amended Form 706)
• Key authorities: IRC §§ 2056(a), 2056(b)(7), 2652(a)(3); Treas. Reg. §§ 20.2056(b)-7, 26.2652-2; Treas. Reg. §§ 301.9100-1, -3 (incl. -3(b)(1)(v)); IRC § 6110(k)(3)

Full text (IRS public release)

Internal Revenue Service
Department of the Treasury
Washington, DC 20224

Number: 202619009
Release Date: 5/8/2026
Index Number: 9100.00-00, 2056.00-00, 2056.07-00, 2652.01-02

Third Party Communication: None
Date of Communication: Not Applicable

Person To Contact:
---------------, ID No. -----------------
Telephone Number:

Refer Reply To:
CC:PT&E:B04
PLR-114540-25
Date:
February 12, 2026

Re: -------------------------------

LEGEND

Decedent = ---------------------------------------------
Spouse = ---------------------------- -----------------
Trust = -------------------------------------------------------------------------
Date 1 = ---------------------
Date 2 = -----------------------
Date 3 = -------------------------
Accountant = -------------------------------------

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

   This letter responds to your authorized representative's letter received August 8, 2025, 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) and a "reverse" QTIP election under § 2652(a)(3).

    The facts and representations submitted are as follows.

    On Date 1, Decedent and Spouse established a revocable trust, Trust. Trust was restated on Date 2 and became irrevocable upon Decedent's death on Date 3. Trust establishes a Marital Trust for the benefit of Spouse during her lifetime. Pursuant to Article II, Paragraph E of Trust, the Marital Trust shall be further divided to create GST exempt and GST non-exempt shares (collectively, the Marital Trusts), as applicable.

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   Article IV, Paragraph A of Trust provides that the Trustee shall pay all of the income of the Marital Trusts to Spouse in at least quarter-annual payments. Trust further provides that as much of the principal of the Marital Trusts may be paid to or for the benefit of Spouse as necessary to provide for Spouse's health, education, maintenance or support. Article XII, Paragraphs (B)(1) and (2) of Trust provide that it is the Decedent's intent that the Marital Trusts shall fully qualify for the marital deduction for estate tax purposes.

   Spouse is the executor of Decedent's estate. Accountant was engaged to prepare and timely file Form 706, United States Estate (and Generation-Skipping Transfer) Tax Return, and to make any necessary elections, including a QTIP election, for Decedent's estate. Form 706 was timely filed (under extension) on behalf of the estate.

    On Form 706, rather than reporting Decedent's assets under the "QTIP property" section of Schedule M (Item A), Accountant inadvertently reported Decedent's assets as "All other property" (Item B). On Schedule R, Accountant listed the GST Exempt Marital Trust as qualifying property for purposes of the reverse QTIP election consistent with the Decedent's intent that the Marital Trust should qualify for the QTIP deduction. However, because of the error on Schedule M, the QTIP election was not made for the Marital Trusts and, due to the failure to make a valid QTIP election, the reverse QTIP election was not effective with respect to the GST Exempt Marital Trust. Sec. 26.2652-2(b). The failure to make the QTIP election was discovered after Spouse's attorney received a copy of the filed Form 706 and noticed the failure to properly report the assets of the Marital Trusts on Schedule M.

You have requested the following rulings:

          1. An extension of time under §§ 301.9100-1 and 301.9100-3 to make a QTIP election under § 2056(b)(7) with respect to the Marital Trusts.

        2. An extension of time under §§ 301.9100-1 and 301.9100-3 to make a "reverse" QTIP election under § 2652(a)(3) with respect to the GST Exempt Marital Trust.

LAW AND ANALYSIS

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

   Section 2044 provides, in part, that the value of the gross estate shall include the value of any property for which a deduction was allowed with respect to the transfer of such property to the decedent under § 2056(b)(7) in which the decedent had a qualifying income interest for life.

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   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.

   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) of the Estate Tax Regulations 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. 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 2601 imposes a tax on every generation-skipping transfer. Section 2611(a) provides that the term "generation-skipping transfer" means: (1) a taxable distribution; (2) a taxable termination; and (3) a direct skip.

   Section 2602 provides that the amount of the GST tax is determined by multiplying the taxable amount by the applicable rate. Section 2641(a) provides that the term "applicable rate" means, with respect to any GST transfer, the product of the maximum federal estate tax rate and the inclusion ratio with respect to the transfer.

   Section 2631(a) provides that, for purposes of determining the inclusion ratio, every individual shall be allowed a GST exemption amount which may be allocated by

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such individual (or his executor) to any property with respect to which the individual is the transferor. Section 2631(b) provides that any allocation under § 2631(a), once made, shall be irrevocable.

     Section 2632(a) provides that any allocation by an individual of his or her GST exemption under § 2631(a) may be made at any time on or before the date prescribed for filing the estate tax return for such individual's estate (determined with regard to extensions), regardless of whether such a return is required to be filed.

    Section 2632(e)(1) provides that, in general, any portion of an individual's GST exemption which has not been allocated within the time prescribed by § 2632(a) shall be deemed to be allocated as follows: (A) first, to property which is the subject of a direct skip occurring at such individual's death, and (B) second, to trusts with respect to which such individual is the transferor and from which a taxable distribution or a taxable termination might occur at or after such individual's death.

   Section 2642(a)(1) provides that, generally, the inclusion ratio with respect to any property transferred in a GST is the excess of one over the applicable fraction determined for the trust. Section 2642(a)(2) provides that, in general, the applicable fraction is a fraction the numerator of which is the amount of the GST exemption allocated to the trust and the denominator of which is the value of the property transferred to the trust, reduced by the sum of any federal estate tax or state death tax actually recovered from the trust attributable to such property, and any charitable deduction allowed under § 2055 or 2522 with respect to such property.

  Section 2652(a)(1) provides that for purposes of chapter 13, the term "transferor" means: (A) in the case of any property subject to the tax imposed by chapter 11, the decedent; and (B) in the case of any property subject to the tax imposed by chapter 12, the donor. An individual shall be treated as transferring any property with respect to which such individual is the transferor.

    Section 2652(a)(3) provides, in pertinent part, that in the case of any trust with respect to which a deduction is allowed to the decedent under § 2056(b)(7), the estate of the decedent may elect to treat all of the property in such trust for GST tax purposes as if the election to be treated as qualified terminable interest property had not been made ("reverse" QTIP election).

    Section 26.2652-2(a) provides, in pertinent part, that if an election is made to treat property as qualified terminable interest property (QTIP) under § 2523(f) or § 2056(b)(7), the person making the election may, for purposes of chapter 13, elect to treat the property as if the QTIP election had not been made ("reverse" QTIP election). A "reverse" QTIP election is not effective unless it is made with respect to all of the property in the trust to which the QTIP election applies. Section 26.2652-2(b) provides that an election under § 2652(a)(3) is made on the return on which the QTIP election is made.

PLR-114540-25 5

  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 Internal Revenue 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 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. Therefore, the executor of Decedent's estate is granted an extension of time of 120 days from the date of this letter to make a QTIP election with respect to Marital Trusts and make a reverse QTIP election with respect to the GST Exempt Marital Trust.

  These elections should be made on an amended Form 706 filed with the Internal Revenue Service Center at the following address: Department of the Treasury, Internal Revenue Service Center, Stop 824G, 7940 Kentucky Drive, Florence, KY 41042-2915. A copy of this letter should be attached to the amended Form 706.

   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.

  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.

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

PLR-114540-25 6

  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, and Estates)

                                             Leslie H. Finlow
                                       By:
                                             Leslie H. Finlow
                                             Senior Technician Reviewer, Branch 4
                                             Office of the Associate Chief Counsel
                                             (Passthroughs, Trusts, and Estates)

Enclosure:
Copy for § 6110 purposes

cc: ----------------------

cc: ------------------------------------------------------------