What Does Portability Refer in Estate Tax Law?
The concept of portability of federal estate tax exemptions between married couples was introduced by the TRUIRJCA in 2011. This feature was made permanent by the American Taxpayer Relief Act in 2013. Portability should remain a permanent part of federal estate tax law. As long as a person owns at least $1 million of property in one state, the exclusion will always be available to him or her in the state of death of the second spouse.
The concept of portability originated as a way to simplify estate planning for married couples by eliminating the need for a bypass trust. Today, it allows a surviving spouse to use the deceased spouse’s estate tax exemption amount, or DSUE. Nonetheless, it is not an ideal replacement for traditional estate planning, and you should make sure to consult an estate attorney before implementing a new estate plan.
Essentially, portability allows a surviving spouse to utilize the estate tax exclusion amount of the deceased spouse. This provision was introduced to help married couples simplify their estate plans by eliminating the need for a bypass trust. While portability is not a substitute for traditional estate planning, it can be a useful tool to avoid the loss of an unused DSUE amount. However, it should be noted that portability only applies to the decedent’s most recent spouse.
Portability is a significant benefit for surviving spouses. It allows a surviving spouse to use the estate tax exemptions of his or her deceased spouse, and makes it easier for a surviving spouse to protect more money from taxes. It can be a big advantage to the remarried spouse. While remarriage is one of the most common reasons for remarriage, it does not affect the ability of a surviving spouse to port the estate tax exemption.
Portability also means that a surviving spouse can use the estate tax exemption of his or her deceased spouse. If a married couple has an unused federal estate tax exemption, portability may not be applicable to a second marriage. When a surviving spouse dies within eight months of the first, the unused portion of the spouse’s exemption will be left to the surviving spouse. This means that a surviving spouse will not have to pay taxes on gifts to her partner’s beneficiaries.
Portability is a major advantage for surviving spouses. By electing to use the unused federal estate tax exemption of their deceased spouse, a surviving spouse will be able to take advantage of the unused portion of the deceased spouse’s exemption, reducing the tax burden of the heir’s heirs. A surviving spouse’s unused exemption will not be lost if portability is elected.
The surviving spouse can remarry after the marriage has ended. A divorce does not end portability. In addition, if the surviving spouse is in a divorce, portability is only available if the deceased spouse’s taxable estate is less than the exclusion amount. This means that, for example, a surviving spouse can remarry and still benefit from portability.
Portability is a benefit of the DSUE. It allows a surviving spouse to make an election to use his or her deceased spouse’s unused estate tax exemption. This will prevent a surviving spouse from losing the unused portion of his or her DSUE amount. The surviving spouse will have to file his or her own federal estate tax return to claim the DSUE.
Portability is another benefit of the surviving spouse. The surviving spouse can elect to use his or her deceased spouse’s unused federal estate tax exemption. This is a benefit for a widow and her surviving husband, since the Survivor’s unused estate tax exemption will be passed to the surviving spouse. The stipulation allows the surviving spouse to use the unused portion of the unused exemption of his or her deceased spouse’s departed estate.