Portability regulations state that when a surviving spouse makes a transfer that is subject to an estate or gift tax, she may take into account the deceased spouse’s unused exclusion (DSUE) amount when calculating the exclusion amount for her tax liability on that transfer. The rule is applicable only when the decedent’s executor chooses portability. Moreover, the regulations allow an executor who elects portability for that decision to be effective retroactively to the date of the decedent’s death. As a result, the surviving spouse may include the DSUE amount when figuring out her applicable tax exclusion to all transfers occurring after the decedent’s death.
See Lewis Saret, Estate Tax Portability – Date DSUE Amount May Be Taken Into Account, Forbes, Jan. 14, 2014.
Special thanks to Brian Cohan (Attorney at Law, Law Offices of Brian J. Cohan, P.C.) for bringing this article to my attention.
