IRS written determination 202610004

Private letter rulings and published taxpayer determination letters. Native document type is retained separately; a determination letter is not labeled a private letter ruling. These taxpayer-specific releases cannot be used or cited as precedent under 26 USC 6110(k)(3); applicability and current legal force are not independently certified. Keep repeated UILC subjects attached to one actual numbered document.

Internal Revenue Service
Department of the Treasury
Washington, DC 20224
Number: 202610004
Release Date: 3/6/2026
Index Number: 2642.07-00

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In Re: ------------------------

Third Party Communication: None
Date of Communication: Not Applicable
Person To Contact:
-------------------------- ID No. -----------------
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Telephone Number:
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Refer Reply To:
CC:PT&E:B04
PLR-110864-25
Date:
December 04, 2025

Legend

Grantor = --------------------------------------------------
Individual = -------------------
Trust = -------------------------------------------------------------------
Accounting Firm = -------------------
Date = ----------------------
Year = -------

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

This letter responds to your authorized representative’s letter dated May 20,
2025, and subsequent correspondence, requesting an extension of time under
§ 2642(g) of the Internal Revenue Code and § 26.2642-7 of the Generation-Skipping
Transfer (GST) Tax Regulations to make an election under § 2632(c)(5)(A)(ii).

The facts and representations submitted are as follows:

Grantor established an irrevocable trust (Trust) on Date in Year for the primary
benefit of Individual, a non-skip person, and made a transfer to Trust in Year in an
amount exceeding the section 2503(b) amount. Trust provides that the trustee may
distribute all or as much of the net income or principal of Trust to Individual as the
trustee determines to be necessary for Individual’s support or best interests. Individual
also has a right to withdraw from Trust an amount equal to the value of each gift to
Trust. The withdrawal right lapses at the end of each calendar year to the extent of the
greater of $5,000 or five percent of the aggregate value of Trust.

Grantor engaged Accounting Firm to prepare his Form 709, United States Gift
(and Generation-Skipping Transfer) Tax Return, for Year. Grantor intended that the

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transfer to Trust would be exempt from GST tax. Accounting Firm prepared Grantor’s
Year Form 709 but failed to elect to treat Trust as a GST trust and failed to affirmatively
allocate GST exemption to the transfer. Due to this failure, no allocation of GST
exemption was applied to Grantor’s Year transfer to Trust. Grantor represents that no
taxable distribution or taxable termination has occurred with respect to Trust.

Grantor requests an extension of time pursuant to § 2642(g) and § 26.2642-7 to
elect under § 2632(c)(5)(ii) to treat Trust as a GST trust.

LAW AND ANALYSIS

Section 2601 imposes a tax on every generation-skipping transfer. A
generation-skipping transfer is defined under § 2611(a) as (1) a taxable distribution,
(2) a taxable termination, and (3) a direct skip.

Section 2602 provides that the amount of the tax imposed by § 2601 is the
taxable amount multiplied by the applicable rate.

Section 2631(a) provides that, for purposes of determining the inclusion ratio,
every individual shall be allowed a GST exemption which may be allocated by such
individual (or his executor) to any property with respect to which such individual is the
transferor. Section 2631(b) provides that any allocation under § 2631(a), once made,
shall be irrevocable.

Section 2632(a)(1) provides that an individual's GST exemption may be allocated
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
return is required to be filed. Section 2632(a)(2) provides that the manner in which
allocations are to be made shall be prescribed by forms or regulations issued by the
Secretary.

Section 2632(c)(1) provides that if any individual makes an indirect skip during
such individual’s lifetime, any unused portion of such individual’s GST exemption shall
be allocated to the property transferred to the extent necessary to make the inclusion
ratio for such property zero. If the amount of the indirect skip exceeds such unused
portion, the entire unused portion shall be allocated to the property transferred.

Section 2632(c)(3)(A) provides that for purposes of this subsection, the term
“indirect skip” means any transfer of property (other than a direct skip) subject to the tax
imposed by chapter 12 made to a GST trust.

Section 2632(c)(3)(B)(iv) provides that the term “GST trust” means a trust that
could have a generation-skipping transfer with respect to the transferor unless the trust
is a trust any portion of which would be included in the gross estate of a non-skip
person (other than the transferor) if such person died immediately after the

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transfer. The value of transferred property shall not be considered to be includible in
the gross estate of a non-skip person or subject to a right of withdrawal by reason of
such person holding a right to withdraw so much of such property as does not exceed
the amount referred to in § 2503(b) with respect to any transferor.

Section 2632(c)(5)(A)(ii) provides that any individual may elect to treat any trust
as a GST trust for purposes of this subsection with respect to any or all transfers made
by such individual to such trust.

Section 2642(a)(1) provides that the inclusion ratio with respect to any property
transferred in a generation-skipping transfer is the excess (if any) of one over the
“applicable fraction.” Under 2642(a)(1), the applicable fraction is defined as a fraction
the numerator of which is the amount of the GST exemption allocated to the trust (or to
property transferred in a direct skip), and the denominator of which is the value of the
property transferred to the trust (or involved in the direct skip), 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 2642(b)(1)(A) provides that, except as provided in § 2642(f), if the
allocation of the GST exemption to any transfers of property is made on a gift tax return
filed on or before the date prescribed by § 6075(b) for such transfer or is deemed to be
made under § 2632(b)(1) or (c)(1) the value of such property for purposes of § 2642(a)
shall be its value as finally determined for purposes of chapter 12 (within the meaning of
§ 2001(f)(2)), or, in the case of an allocation deemed to have been made at the close of
an estate tax inclusion period, its value at the time of the close of the estate tax
inclusion period.

Section 2642(g)(1)(A) provides that the Secretary shall by regulation prescribe
such circumstances and procedures under which extensions of time will be granted to
make an allocation of GST exemption described in § 2642(b)(1) or (2), and an election
under § 2632(b)(3) or (c)(5). Such regulations shall include procedures for requesting
comparable relief with respect to transfers made before the date of the enactment of
§ 2642(g).

Section 2642(g)(1)(B) provides that in determining whether to grant relief under
this paragraph, the Secretary shall take into account all relevant circumstances,
including evidence of intent contained in the trust instrument or instrument of transfer
and such other factors as the Secretary deems relevant. For purposes of determining
whether to grant relief under this paragraph, the time for making the allocation (or
election) shall be treated as if not expressly prescribed by statute.

Section 26.2642-7 of the Generation-Skipping Transfer Tax Regulations sets
forth the procedures for requesting an extension of time to make an allocation of GST

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exemption described in § 2642(b)(1) or (2), and an election under § 2632(b)(3) or (c)(5),
and the standards used to determine whether relief may be granted.

Section 26.2642-7(d)(1) provides that requests for relief will be granted when and
to the extent that the transferor or the executor of the transferor’s estate provides
evidence establishing to the satisfaction of the IRS that the transferor or the executor of
the transferor’s estate acted reasonably and in good faith, and that the grant of relief will
not prejudice the interests of the government.

Section 26.2642-7(d)(2) provides a nonexclusive list of factors that will be
considered in determining whether the transferor or the executor of the transferor’s
estate acted reasonably and in good faith for purposes of § 26.2642-7, including
reasonable reliance by the transferor or the executor of the transferor’s estate on the
advice of a qualified tax professional.

Based on the facts submitted and the representations made, we conclude that
the requirements of § 26.2642-7 have been satisfied. Therefore, Grantor is granted an
extension of time of 120 days from the date of this letter to elect to treat Trust as a GST
trust. As a result of the election, the automatic allocation rules of § 2632(c) apply to
allocate Grantor’s available GST exemption to the Year transfer to Trust. The allocation
will be effective as of the date of Grantor’s transfer to Trust, and the value of the transfer
as determined for federal gift tax purposes will be used in determining the amount of
GST exemption to be allocated to Trust.

The election to treat Trust as a GST trust should be made on an amended Form
709 for Year. The Form 709 should be filed with the Internal Revenue Service at the
following address: Internal Revenue Service Center, ATTN: E&G, Stop 824G, 7940
Kentucky Drive, Florence, KY 41042-2915. You should attach a copy of this letter to the
amended Form 709.

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

Except as expressly provided herein, we neither express nor imply any opinion
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-110864-25

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Sincerely,

Leslie H. Finlow
______________________________
[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:

cc:
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