simplified portability election

Treasury Regulation Sec. For 2019, the exemption has been adjusted for inflation to $11.4 million per taxpayer, and $22.8 million per married couple. 2014-18 provides an automatic extension for certain estates of decedents dying in 2011, 2012 and 2013 to elect portability. Trust & Estates Section IRS Releases Final Anti-Clawback ... ESTATE TAX PORTABILITY EXPLAINED - Ally Legal Planning On June 9, 2017, the Internal Revenue Service issued Revenue Procedure 2017-34, which is effective immediately and provides a simplified method to obtain permission for an extension of. 20.2056(b)-7(h), Examples 7 and 8; (3) The QTIP election was a protective election under Treasury Regulation Sec. The first two mulligans. On March 23, 2015, Troy . Proc. However, it has faced some problems, including the surviving spouse may not be aware of the potential action and there is a time limit of nine months after a spouse passes away to make a spousal portability election. In the earlier years after the DSUE portability provisions were originally enacted, the IRS provided a simplified method for getting a time extension to make the portability election for estates that wouldn't normally need to file an estate tax return. To make the election, a complete and properly prepared Form 706 must be filed on or before the later of January 2, 2018, or by the second annual anniversary of the decedent's date of death. The portability election is a simplified and effective post-mortem tool that surviving spouses may employ to allow full use of both spouses' exclusion amounts and potentially result in significant estate tax savings even if sophisticated estate planning was not undertaken by the deceased spouse. Under Regulations section 20.2010-2(a)(5), the executor of an estate of a nonresident decedent who was not a citizen of the United States at the time of death cannot make a portability . Simplified Method for Estate Tax Portability Provided in Rev. After 2014 the IRS received a number of requests for letter ruling (applicable only to the involved taxpayer) requesting late election relief for the portability or DSUE election. Those eligible must be decedents . The executor must state at the top that the return is "filed pursuant to Rev. Secs. This is a great benefit to the many executors (and their practitioners) who may miss this deadline. Last Updated: 7/17/17. 2017-34, which provides a simplified way to obtain an extension for making a late or missed "portability" election. 2017-34 provides a simplified method for such estates that have no filing requirement to obtain an extension of time under § 301.9100-3 of the Regulations to elect portability. 2010(c)(5)(A). 2017-34 to elect portability under § 2010 (c) (5) (A)." Proc. 2017-34) a simplified method for electing portability in lieu of the estates obtaining a PLR. (2) A QTIP election was stated in terms of a formula designed to reduce the estate tax to zero. in february 2014, the irs issued revenue procedure 2014-18 that provided a simplified method for obtaining an extension of time under the "9100 relief" provisions to make a portability election that was available to estates of decedents dying after 2010, if the estate was not required to file an estate tax return and if the decedent was survived … The concept of portability of a person's unused gift and estate tax exemption became law on a temporary basis in 2010 and on a permanent basis in 2013. BACKGROUND The IRS recently updated its accounting method to elect portability, the simplified method of which was only available before Dec. 31, 2014.. Under § 2010(c)(5)(A) of the Internal Revenue Code, a portability election creates a method for a decedent's unused exclusion amount, also known as the deceased spousal unused exclusion . 2017-34 A decedent is allowed an exclusion amount against the Federal Estate and Gift tax. Revenue Procedure 2014-18 provides an automatic extension of time for certain estates without a filing requirement to elect portability of the decedent's unused exclusion amount for the benefit of the decedent's surviving spouse. • The following criteria must be met: −Decedent must be survived by a spouse. This revenue procedure provides a simplified method for certain taxpayers to obtain an extension of time to make a portability election. When a person dies, the federal government allows a portion of their assets to be excluded from their estate, $5,490,000 in 2017. Simplified Method Offered for Requesting Extended Time to Make Portability Election January 26, 2014 The IRS on Monday offered certain executors a simplified way to request an extension of time to make the "portability" election to transfer a deceased spouse's unused estate tax exclusion to the surviving spouse ( Rev. Those eligible must be decedents . The simplified method provides the exclusive means by which an extension of time to make a portability election may be obtained for situations in which requirements (1) through (3) (described . The simplified method for estates to qualify for relief to file an estate tax return only is available if filed on or before the later of January 2, 2018, or two years from the date of death. On top of this generous amount, the IRS also allows for portability of the exemption between . The IRS has issued a revenue procedure, Rev. The IRS posted revised instructions to Form 706, United States Estate (and Generation-Skipping Transfer) Tax Return, with guidance for electing the portability of a deceased spouse's unused estate and gift tax exclusion amount.The instructions also address an executor's use of a checkbox to opt out of electing portability of the unused portion of the exclusion amount. −Decedent died after 12/31/10. IRS Provides Simplified Method to Obtain Extensions By Stuart R. Josephs, CPA Rev. −Gross estate must be under the filing threshold and an estate tax return was not filed timely. Proc. Effective June 9, 2017, Rev. 2017-34 (IRB 2017-26, June 26, 2017), effective June 9, provides a simplified method for certain taxpayers to obtain an extension of time to make a portability election under IRC Sec. Proc. For estates of decedents that do not have an estate tax filing requirement, the benefit of making the portability election can easily be overlooked to the detriment of the surviving spouse. But that simpler method was only available up until the end of 2014. In order to elect portability, a surviving spouse must file an estate tax return (Form 706 for the federal estate tax and Form MET-1 for the Maryland estate tax) within nine months of their spouse's date of death. 2017-34. To make a portability election, the decedent's estate must file IRS Form 706, which is the "United States Estate (and Generation-Skipping Transfer) Tax Return." On that form, the estate can elect to transfer the DSUE to the surviving spouse. Summary. The simplified method is to be used in lieu of the letter ruling process and no user fee is required for submissions filed under the . portability of the estate tax exemption means that if one spouse dies and does not make full use of his or her $5,000,000 (in 2011, or $5,120,000 in 2012, $5,250,000 in 2013, $5,340,000 in 2014, and $5,430,000 in 2015) federal estate tax exemption, then the surviving spouse can make an election to pick up the unused exemption and add it to the …