The devil truly is in the details when it comes to much of life. So it is with taxes and estate tax planning.
How and when can it be used, whether in Overland Park and elsewhere?
The temporary regulations governing portability are now on the books. While there is some guidance regarding how a “Deceased Spouse Unused Exemption” (DSUE) actually works, a recent Forbes article, titled “Estate Tax Portability - Date DSUE Amount May Be Taken Into Account” provides some practical advice.
As many know, “portability” refers to the new ability of a deceased spouse to pass along their unused unified exemption amount (the amount in a lifetime that you can either transfer without gift tax or can pass through your estate without estate tax) to their surviving spouse without implementing traditional estate tax planning techniques.
The question many surviving spouses might face is when to make use of the exemption. What if they have a gifting strategy, especially if there is little time to spare? Does the DSUE pass immediately or does the estate tax return have to be filed?
As a rule of thumb, the DSUE passes immediately. In turn, this can buy some time given how long it could take to file an estate tax return.
As with all tax matters, be sure to consult with your professional advisors before making a move you cannot undue later.
Remember: “An ounce of prevention is worth a pound of cure.” When making your financial, tax and estate plans, do not go it alone. Be sure to engage competent professional counsel.
For more information about estate planning in Overland Park, KS (and throughout the rest of Kansas and Missouri) and to download free tools to help you organize your estate, visit my estate planning website.
Reference: Forbes (January 14, 2014) “Estate Tax Portability - Date DSUE Amount May Be Taken Into Account”