IRS Transfer Certificate: Form 706-NA, Filing, and Asset Release

The IRS Transfer Certificate, Form 5173, is the document that releases a nonresident decedent’s U.S. assets from federal estate tax restrictions so banks, brokerages, and transfer agents will hand them over to the estate. You obtain one by filing Form 706-NA with the IRS, and processing typically takes six to nine months from the date the IRS receives a complete filing.

What the Certificate Does

The certificate is the IRS’s formal statement that the estate’s federal tax obligations have been satisfied or that no tax was due. It functions as a release order directed at anyone holding the decedent’s U.S. property. Without it, domestic corporations, transfer agents, banks, and custodians face potential liability for taxes and penalties if they release the assets.

Treasury regulations specifically prohibit domestic corporations and their transfer agents from transferring stock registered in the name of a nonresident decedent without first obtaining a transfer certificate covering all of the decedent’s stock in that corporation.¹ Banks and other custodians follow the same logic. That is why they freeze accounts the moment they learn of a nonresident account holder’s death.

Form 4422, which discharges specific property from the federal estate tax lien for sale, is a separate document and not a substitute. If the executor was not appointed and is not acting within the United States, the estate needs a Transfer Certificate regardless of whether property is being sold.²

When You Do Not Need One

Two situations remove the certificate requirement.

The first is a U.S.-appointed executor. Treasury regulations carve out an exception for shares submitted for transfer by an executor or administrator who has been appointed, qualified, and is acting within the United States.¹ If a U.S.-based fiduciary obtains letters testamentary or letters of administration from a U.S. court, those probate documents can be presented directly to the financial institution.

The second is an estate below the filing threshold. If the IRS determines no Form 706-NA filing was required, it issues correspondence stating that a Transfer Certificate is not required and will not be issued.³ That letter, with a death certificate and any probate documentation, is generally enough for institutions to release the assets. Contact each institution early anyway, because some have their own internal thresholds and release procedures.

Who Must File Form 706-NA

The filing requirement applies to estates of individuals who were neither U.S. citizens nor domiciled in the United States at the time of death. Domicile is the place the person intended to maintain a permanent home, not simply where they were living. Someone can reside in the U.S. for years without establishing domicile if the intent was always to return to their home country.

The threshold is low. An estate must file Form 706-NA if the gross value of the decedent’s U.S. situs assets, combined with any gift tax specific exemption previously used and any adjusted taxable gifts, exceeds $60,000 at the date of death.⁴ It looks at gross value before debts or mortgages. If the decedent held $80,000 in U.S. stocks with $30,000 owed against them, the estate still exceeds the threshold because the IRS uses the $80,000 figure.⁵

Many estates that cross the threshold owe no tax after deductions, credits, or treaty benefits. The return is still mandatory, and it is the only way to obtain the certificate.

What Counts as U.S. Situs Property

The IRS treats these categories as located in the United States for estate tax purposes:

Stock of any corporation organized under U.S. law, regardless of where the certificates are physically held.
Real property physically located in the United States.
Tangible personal property such as art, vehicles, and jewelry located in the U.S. at death.
Debt obligations issued by U.S. persons, domestic corporations, or U.S. government entities.

Two important exclusions cut the other way. Life insurance proceeds on the decedent’s life are excluded entirely. Bank deposits that are not effectively connected with a U.S. trade or business are also excluded.⁴ A decedent with $200,000 in a U.S. savings account and $40,000 in U.S. stocks may have only $40,000 in countable situs assets, which falls below the filing threshold.

Deadline, Extensions, and Penalties

Form 706-NA is due within nine months of the date of death. That deadline covers both filing the return and paying any tax owed.⁴

The executor can request an automatic six-month filing extension by submitting Form 4768 before the original deadline. An executor located outside the country who has already used the six-month extension can request additional time with a second Form 4768 and a written explanation.⁴ An extension to file does not extend the time to pay. Interest accrues on any unpaid balance from the nine-month mark.

Late filing triggers two penalties. The failure-to-file penalty runs at 5% of the unpaid tax per month or partial month, capped at 25%. The failure-to-pay penalty adds 0.5% per month on any unpaid balance, also capped at 25%. When both apply in the same month, the failure-to-file amount is reduced by the failure-to-pay amount.⁶ Interest compounds on top. For the first half of 2026, the IRS underpayment rate is 7% for the first quarter and 6% for the second.⁷

Penalties apply only to unpaid tax. An estate that files late but owes nothing faces no financial penalty. Filing is still necessary to get the certificate, and every month of delay pushes the release of the assets further out.

Preparing the Return

Assembling the Form 706-NA package usually means gathering documents across borders. Start with certified copies of the death certificate, the will or trust documents, and proof of the executor’s authority to act, such as a grant of probate from the decedent’s home country. If the executor is abroad and wants a U.S. attorney or accountant to handle the filing, that representative should submit Form 56 to establish the fiduciary relationship with the IRS.

Valuing the Assets

Every U.S. situs asset must be valued as of the date of death. The executor may elect the alternate valuation date, six months after death, but only if the election decreases both the gross estate value and the net tax due. The election covers all property; you cannot pick which assets get the later date.⁴

Publicly traded securities are valued at the mean of the highest and lowest quoted selling prices on the valuation date.⁸ If no trades occurred that day, the regulations use a weighted average of the nearest trading dates before and after. Real estate requires an appraisal from a qualified U.S. appraiser. The return also has to report the value of the decedent’s entire worldwide estate, because several calculations, including deduction proration, depend on the ratio of U.S. to worldwide property.

Claiming Deductions

The estate can deduct funeral expenses, administration costs, claims against the estate, and unpaid mortgages on property included in the gross estate.⁴ Deductions are prorated: only the portion matching the ratio of U.S. property to the worldwide gross estate reduces the taxable amount. If U.S. assets are 10% of the worldwide estate, only 10% of otherwise deductible expenses can be claimed.

The IRS needs worldwide asset documentation even though it only taxes the U.S. portion. Executors sometimes resist that disclosure, but skipping it forfeits the ability to claim any deductions.

Unified Credit and Treaty Benefits

Nonresident alien estates are taxed at the same graduated rates as U.S. citizens, up to 40% on amounts above $1 million. The credit available to offset the tax is much smaller. The default unified credit for a nonresident alien estate is $13,000, sheltering only the first $60,000 of taxable value, compared with the $15,000,000 exclusion available to U.S. citizens and residents for deaths in 2026.⁹

Estate tax treaties can change the math. The U.S. maintains estate tax treaties with 15 countries: Australia, Austria, Canada, Denmark, Finland, France, Germany, Greece, Ireland, Italy, Japan, the Netherlands, South Africa, Switzerland, and the United Kingdom. Under most of these treaties, the credit is prorated so the estate receives a share of the full U.S. exemption based on the proportion of the decedent’s worldwide estate located in the United States.⁹ For a decedent from a treaty country whose U.S. assets are a small share of overall wealth, the prorated credit often eliminates the tax.

To claim treaty benefits, identify the specific treaty article being relied on and attach supporting documentation to the Form 706-NA. Checking a box is not enough. The IRS expects a clear statement of which provision applies and the calculations behind the claimed credit. Errors here are one of the most common reasons the IRS sends back requests for additional information, adding months to the timeline.

Where to Submit

Form 706-NA cannot be filed electronically. The completed return and all supporting documents go by mail to:⁴

Department of the Treasury
Internal Revenue Service Center
Kansas City, MO 64999

For a private delivery service such as FedEx or UPS:

Internal Revenue Submission Processing Center
333 W. Pershing
Kansas City, MO 64108

Send the package by certified or registered mail (or the private delivery service equivalent) for proof of delivery and a postmark establishing the filing date. Keep a complete copy of everything submitted. If the IRS loses the package or disputes the filing date, that copy is the estate’s only protection.

Any tax due must be paid by the nine-month deadline even with a filing extension. EFTPS is the standard electronic payment method but requires a U.S. bank account. Executors abroad without a U.S. account can arrange a same-day wire transfer through a financial institution with a U.S. affiliate.¹⁰ Checks or money orders payable to “United States Treasury” can also be included with the mailed return.

IRS Processing and Requests for Information

Expect six to nine months from the date the IRS receives a complete filing before the certificate is issued.¹¹ Complex estates, treaty claims, and peak-period filings take longer. There is no formal expedite procedure.

During review, the IRS may issue a Request for Additional Information. Common triggers are unclear valuations, missing worldwide estate documentation for deduction proration, and incomplete treaty claims. Respond quickly and completely. Every unanswered RAI resets the processing clock, and partial responses usually generate a second one, so taking an extra week to compile a full response beats sending something incomplete.

Once the review is finished and any tax due has been paid, the IRS mails Form 5173 to the executor or the authorized representative listed on the return. The certificate covers all U.S. assets identified on the Form 706-NA.

Using the Certificate to Release Assets

With the certificate in hand, contact each financial institution or transfer agent holding the decedent’s property. Each will need its own copy of Form 5173 and a certified copy of the death certificate. Many also require their own internal transfer forms.

The certificate removes only the federal tax restriction. It does not by itself give the executor legal authority to take possession. Most institutions also require evidence of legal standing, such as letters testamentary or letters of administration from a court, or equivalent documentation from the decedent’s home country if no U.S. probate was opened. Check with each institution early so these documents can be assembled in parallel.

State requirements add another layer. If the decedent owned real property in a U.S. state, that state may have its own estate or inheritance tax, and some require their own clearance before title can transfer. The federal certificate does not satisfy state obligations.

Once federal and state clearances are in place and each institution has processed its internal paperwork, the executor can distribute the U.S. assets under the will or the succession laws of the decedent’s home country. From death to final distribution, the process commonly takes twelve to eighteen months, with the IRS processing window as the largest single component.

1
GovInfo. 26 CFR 20.6325-1 – Release of Lien or Partial Discharge of Property; Transfer Certificates in Nonresident Estates
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Internal Revenue Service. Application for Certificate Discharging Property Subject to Estate Tax Lien
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Internal Revenue Service. Transfer Certificate Filing Requirements for the Estates of Nonresidents Not Citizens of the United States
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Internal Revenue Service. Instructions for Form 706-NA (Rev. September 2025)
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Internal Revenue Service. Estate Tax
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Taxpayer Advocate Service. Failure to File Penalty Under IRC 6651(a)(1), Failure to Pay an Amount Shown As Tax on Return Under IRC 6651(a)(2)
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Internal Revenue Service. Quarterly Interest Rates
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eCFR. 26 CFR 20.2031-2 – Valuation of Stocks and Bonds
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Office of the Law Revision Counsel. 26 USC 2102 – Credits Against Tax
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EFTPS. International Guide for Paying Federal Taxes Electronically
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Internal Revenue Service. Transfer Certificate Filing Requirements for the Estates of Nonresident Citizens of the United States