The IRS recently issued an official statement extending the deadline for certain taxpayers to make a “portability” election of their deceased spouse’s unused federal estate tax exclusion amount (or DSUE amount). The portability election allows the decedent’s spouse to apply the DSUE amount to their own transfers during life and death (except for generation skipping transfers). See Rev. Proc. 2014-18.
The deadline for making the portability election under this new IRS procedure is December 31, 2014. This extension of time applies to those decedents who died with a surviving spouse; died after December 31, 2010 and on or before December 31, 2013; was a citizen or resident of the United States on the date of death; and had a gross estate which includes taxable gifts at date of death of under $5,000,000, as adjusted for inflation in each year after 2011.
If your spouse died in 2011, 2012, or 2013, his or her estate may qualify for the portability election. “Spouse” includes an individual legally married to a person of the same gender, even if no longer residing in a state where same-gender marriage is recognized.
Given the quickly approaching extension deadline, we urge you to call us to talk about this issue.