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How to mark the 2632(c) election on Form 709, Indirect Skips Column C

SOLVEDby IntuitLacerte Tax13Updated September 20, 2022

To trigger this election:

  1. Open the Gift module in Lacerte.
  2. Go to Screen 7, Taxpayer's Gifts.
  3. Select an option from Elect out of 2632(c) allocation (Part 3) (Ctrl+T) (code 30)
    • Selecting a 1 or 2 from the table makes the election under section 2632(c)(5), to not have the automatic allocation rules of section 2632(c) apply to the transfer.
      • The net transfer amount for this gift won't be included in the amount for Schedule C, page 4, Part 2, Line 5, allocation of exemptions to transfers reported on Schedule A, Part 3.
      • An election statement is produced listing the GST trust name, ID# the transfer was given to, and the description of the transfer and amount of allocation not applied.
    • Selecting a 3 from the table is electing under section 2632(c)(5) to treat any trust as a GST trust.
      • Column C, Part 3, Schedule A, Page 2 of Form 709 is still checked, but the net transfer is included in the automatic calculation for Schedule C, Page 4, Part 2, Line 5, allocation of exemption to transfers reported on Schedule A, Part 3.
      • An election statement is produced stating the election that was made.
  4. When an election is made, the check wont appear on 709 page 3. Instead, it will appear when viewing the Schedule A, Part 3 Attachment that is created by the election.

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