How to File the New York State Estate Tax Return (Form ET-706)

To file the New York State estate tax return on Form ET-706, the executor gathers date-of-death valuations for everything the decedent owned, prepares a federal Form 706 to attach even if none is required by the IRS, completes the ET-706 schedules that apply to the estate, and mails the paper return with any payment to the state’s processing center in Albany within nine months of the date of death.¹

Does the Estate Have to File

Under New York Tax Law Section 971, the executor of a New York resident must file the ET-706 when the federal gross estate, plus certain includible gifts, exceeds the basic exclusion amount.² For deaths in 2026, that threshold is $7,350,000.³ The federal gross estate is a broad measure. It picks up real estate, bank and investment accounts, retirement accounts, life insurance proceeds, jointly held property, and trust interests, wherever located.

Filing is required once the gross value crosses the threshold even if deductions will later wipe out the tax. The obligation is the return itself; whether anything is owed falls out of the calculation.

Nonresident Decedents

A nonresident must file the ET-706 only if two conditions are both met: the estate includes real or tangible personal property physically located in New York, and the total federal gross estate plus includible gifts exceeds the basic exclusion amount.² The tax on a nonresident estate is prorated based on the ratio of New York property to the whole.

Gifts in the Three Years Before Death

When measuring the estate against the filing threshold, add back any taxable gift the decedent made during the three years before death that is not already included in the federal gross estate. Gifts are excluded from that add-back if they were made while the decedent was a nonresident, made before April 1, 2014, made between January 1 and January 15, 2019, or consisted of real or tangible property located outside New York at the time of the gift.³ Pull prior federal Form 709 gift tax returns so you can identify these transfers accurately.

What to Gather Before You Start

Missing documentation is the most common reason the Tax Department sends a return back for more information, which adds months. Pull these together before opening the form:

The decedent’s Social Security number, legal name, date of death, and domicile at death, plus the executor’s contact information and the estate’s EIN if one has been obtained.
A certified copy of the death certificate.
Professional appraisals of every parcel of real property as of the date of death. Tax assessments and online estimates will not satisfy the department.
Bank, brokerage, and retirement account statements showing balances on the date of death.
Copies of every life insurance policy on the decedent’s life, including group coverage through an employer, with face amounts and beneficiary designations.
Any trust agreements where the decedent was a grantor or held a power that causes inclusion in the gross estate.
A formal valuation by a qualified appraiser for any closely held business interest.
Federal Form 709 filings for taxable gifts, especially those made within three years of death.
Mortgage balances, credit card statements, outstanding loans, and medical bills owed at death.
Funeral and burial receipts and invoices.
A copy of the will and the court-issued letters appointing the executor.

Filling Out the ET-706

The ET-706 is organized around lettered schedules A through U that sort property and deductions by type.¹ You complete only the schedules that apply. The ones most estates touch:

Schedule A for real estate: every parcel, its address, date-of-death fair market value, and the appraiser’s name, with appraisal reports attached.
Schedule B for stocks and bonds, reported at closing price on the date of death.
Schedule C for mortgages, notes, and cash, including bank balances and CDs.
Schedule D for insurance on the decedent’s life where the decedent held incidents of ownership, even if proceeds pass directly to a named beneficiary.
Schedule E for jointly owned property, reporting the decedent’s includible share.
Schedule G for lifetime transfers pulled back into the gross estate under the Internal Revenue Code.
Schedule M for property passing to a surviving spouse that qualifies for the unlimited marital deduction.
Schedule U for land subject to a qualified conservation easement.

The summary section on the main pages totals the asset schedules, subtracts the allowable deductions (funeral expenses, administration costs, debts, and the marital and charitable deductions), and arrives at the New York taxable estate. The form then applies the rate table and the applicable credit to compute the tax. New York uses graduated rates from 3.06% up to 16% on taxable estate amounts above $10,100,000.⁴

One point worth flagging on the math: a credit under Tax Law Section 952(c) zeroes out the tax for estates at or below the basic exclusion, phases out across a narrow band, and disappears entirely for estates above 105% of the exclusion ($7,717,500 for 2026 deaths), at which point tax applies to the full taxable estate from the first dollar.⁴ Valuations in that range deserve careful attention. New York also does not allow portability of a deceased spouse’s unused exclusion, so no leftover exclusion from a prior spouse can be claimed on the return.

Attach a Federal Form 706

A completed federal estate tax return (Form 706) must be submitted with the ET-706, even if the estate has no federal filing obligation.⁵ The federal exclusion is far higher than New York’s, so plenty of estates that file in Albany owe nothing to the IRS. The federal form’s asset schedules and calculations serve as the baseline for the state’s computation, so you still have to prepare it and include it.

Deadline and Extensions

The ET-706 is due nine months after the decedent’s date of death. A March 15 death produces a December 15 deadline.⁶ When the due date falls on a weekend or legal holiday, it shifts to the next business day.

An executor who needs more time can file Form ET-133 before the original deadline to request up to six additional months. The extension can cover filing, payment, or both.⁷ An extension to pay requires showing that paying by the original deadline would cause undue hardship. Being busy is not enough.

Extra time to file does not stop interest. Interest begins accruing on any unpaid tax the day after the nine-month due date, regardless of a filing extension.⁶ If tax will clearly be owed but the final numbers are not ready, estimate the liability and send that amount with the ET-133.

How to Submit and Pay

The ET-706 cannot be filed electronically. Mail the paper return to:¹

NYS Estate Tax Processing Center
PO Box 15167
Albany, NY 12212-5167

If you use a private delivery service, check the Tax Department’s Publication 55 for designated services and the correct street address; private carriers cannot deliver to a PO box. Send the return by certified mail with return receipt requested. That receipt is your proof of timely filing.

If tax is owed, include Form ET-706-V, the payment voucher, with a check or money order payable to the NYS Estate Tax Processing Center.¹ The voucher ties the payment to the correct estate account. Executors can also pay electronically through the Tax Department’s Fiduciary Online Services portal.⁸

Penalties and Interest if You Miss the Deadline

Filing late and paying late carry separate penalties that can stack.

Late filing: 5% of the unpaid tax for each month or partial month the return is overdue, capped at 25%. A minimum penalty applies if the return is more than 60 days late.⁹
Late payment: 0.5% of the unpaid tax per month, also capped at 25%.⁹
Interest: charged on any tax not paid by the original due date and compounded daily, at a rate the Tax Department sets quarterly. Interest generally cannot be waived.⁹

The late filing penalty is the larger risk. An estate that owes $500,000 and files four months late faces a $100,000 penalty on top of the tax. Late payment penalties may be waived for reasonable cause, but that is case by case. Filing on time, with at least an estimated payment, is the simplest way to limit exposure.

Releasing the Estate Tax Lien on Real Estate

When someone dies owning real estate in New York, a statutory lien attaches to every parcel as of the date of death. Property cannot be transferred or sold until the Tax Department releases the lien, whether or not any tax is actually owed.¹⁰ The only exception is property held solely by the decedent and a surviving spouse as the only joint tenants.

To obtain the release, file Form ET-117 (Release of Lien of Estate Tax — Real Property or Cooperative Apartment) along with Form ET-30, ET-706, or ET-85, depending on whether an executor has been appointed and how long it has been since the date of death. If the ET-706 has already been filed and is not being amended, submit only the first page marked “Copy for Lien Request.”¹⁰

A few practical points:

Processing takes three to four weeks for a completed application, plus seven to ten business days for mailing.¹⁰
There is no fee.
File a separate ET-117 for properties in different counties, and a separate one for a cooperative apartment versus real property, even in the same county.
All unpaid tax assessments against the estate must be paid before the department will process the release.

Do not schedule a real estate closing until the stamped release is in hand. Starting the ET-117 early is one of the most useful things an executor can do when the estate holds property that will be sold.

The Closing Letter

After the Tax Department processes the ET-706, it issues a closing letter confirming no further tax is due, or acknowledging the tax paid as final. Most closing letters arrive about nine months after the return is filed.³ Returns with errors or those selected for audit take longer; the closing letter follows roughly 30 days after the audit closes. If the department sends a letter requesting more information on specific valuations or deductions, respond quickly, because delays stretch the whole timeline. Once the closing letter arrives, the executor has formal confirmation that the estate’s obligation to New York is settled, which clears the way for final distribution to beneficiaries.

1
New York State Department of Taxation and Finance. Instructions for Form ET-706 New York State Estate Tax Return
2
New York State Senate. New York Tax Law 971 – Returns by Executor
3
New York State Department of Taxation and Finance. Estate Tax
4
New York State Senate. New York Tax Law 952 – Tax Imposed
5
New York State Department of Taxation and Finance. ET-706 New York State Estate Tax Return
6
New York State Department of Taxation and Finance. Instructions for Form ET-133 Application for Extension of Time To File and/or Pay Estate Tax
7
New York State Department of Taxation and Finance. ET-133 Application for Extension of Time To File and/or Pay Estate Tax
8
New York State Department of Taxation and Finance. Online Services
9
New York State Department of Taxation and Finance. Interest and Penalties
10
Department of Taxation and Finance. Release of Estate Tax Lien