How portability of the estate-tax exclusion will affect estate planning

05/3/2011 | Tax Adviser, The

The Tax Relief, Unemployment Insurance Reauthorization, and Job Creation Act of 2010 made the estate and gift tax portable between spouses; that is, it increases the applicable estate and gift exclusion amount for a surviving spouse by the amount of the unused exclusion amount of the deceased spouse (for spouses dying after 2010 and before 2013). This should make estate planning much simpler for most married couples, but it does require an election by the estate of the first-to-die spouse. And because the portability provision does not apply to the generation-skipping transfer tax exemption and because of uncertainty as to whether it will be extended beyond 2012, couples with estates potentially subject to estate tax should still engage in estate planning.

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Tax Adviser, The

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