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While planning for estate tax filings upon death isn't something anyone is jumping to do, it is essential to saving your family and loved ones from potential and unnecessary tax obligations.
One of the key elements of the American Tax Relief Act of 2012 (ATRA) – portability – allows for the transfer of any unused estate tax applicable exclusion amount at the death of the first spouse, aka tax payment savings, to the surviving spouse. However, without knowledge of the tax implications surrounding portability, many who find themselves widowed, may be subject to a large federal estate tax bill.
What many taxpayers do not know, is that the IRS requires them to file an estate tax return upon the death of their spouse to take advantage of portability. If this doesn't happen, you could be left in a seemingly cumbersome and endless limbo with the IRS.*
Click the link below to learn more about the potential estate tax trap regarding portability.
Our team at Delap has a designated trust & estate group of CPAs who are here to help with any unanswered questions, or further clarification. Reach out to us to if you're curious to learn more.
*Forbes (2015, March). The Surviving Spouse Estate Tax Trap. Retrieved March 25th, 2015 from: http://www.forbes.com/sites/ashleaebeling/2015/03/25/the-surviving-spouse-estate-tax-trap/?ss=taxes