No Federal Estate Tax = No Inheritance For Your Spouse?

According to Martin Vaughan, Estate-Tax Repeal Means Some Spouses Are Left Out, WSJ, Jan. 2, 2010, the federal estate tax repeal could leave some spouses out in the cold:

[W]ills typically direct assets not subject to the tax be passed on to children—for 2009, up to $3.5 million—with the rest directed to the spouse.

‘You could be in a situation now where everything would go into a trust downstream to the kids and nothing is left to the spouse,’ said Greg Rosica, a tax partner at Ernst & Young.

Furthermore, although a surviving spouse may be able to elect a forced share against their spouse’s will, this process is more expensive and time consuming than a direct gift.

Special thanks to Patrick S. Sylvester (Attorney & Counselor at Law, Sylvester Law Firm, PC) for bringing this to my attention.