Thursday, October 13, 2011

"Portability" of Estate Tax Exemption to Spouse

"Portability" as mentioned in the October 8-9, 2011 Wall Street Journal "allows a surviving spouse in effect to roll over the unused portion of a deceased spouse's [estate tax] exemption."

Ms. Saunders in her Wall Street Journal article mentions that the IRS has clarified what needs to be done if a spouse wishes to carry over the deceased spouse's unused estate tax exemption to their own estate. She indicates that the IRS has done some clarifying, but it will only apply to 2011 and 2012 unless Congress applies the same estate tax provisions to future years.

One important point is that even if the deceased spouse has a small estate, an estate tax return must be filed nine months after the individual has died, with a six month filing extension available, in order for a spouse to take advantage of the portability option.

If you are married, it is a good idea to become familiar with what is required in order to take advantage of the portability option.

Read the Wall Street Journal here.

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