Through this election, the decedent's DSUE becomes available to the surviving spouse's subsequent transfers during life or at death. −Decedent was a U.S. citizen or resident at time of death. Proc. Proc. . New Simplified Method for Late DSUE Election | Copeland Buhl 2017-34 provides a second bite at the apple - a continued simplified procedure for obtaining an extension of time to make a portability election - one that does not require a private letter ruling request ("PLR") or a filing fee. This means that for decedent's dying in 2017 . Private Client Services Update - Portability Election ... IRS Issues Revenue Procedure 2017-34, Announcing ... This is called the deceased spouse's unused exemption or "DSUE." 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. A spousal portability election is a good idea. Secs. 2017-34, which provides a simplified way to obtain an extension for making a late or missed "portability" election. Rev. The IRS has formally established a simplified procedure by which taxpayers may obtain a retroactive extension of time to make a portability election. Proc. The IRS has issued a revenue procedure, Rev. Instructions address portability election The IRS is also making the simplified method of this revenue procedure available after January 2, 2018, to estates during the two-year period . 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 . The Revenue Procedure is a simplified method to be used to make a late portability election. Proc. Those eligible must be decedents . 20.2056(b)-7(c); and (4) The executor of the estate made a portability election. Portability - To do or not to do? | YHB Tax & Advisory The IRS recently updated its accounting method to elect portability, the simplified method of which was only available before Dec. 31, 2014.. On January 27, 2014, the Internal Revenue Service announced in Revenue Procedure 2014-18 a simplified procedure for certain estates to make a late portability election under section 2010(c)(5)(A) of the Internal Revenue Code. 2017-34 to simplify the method to obtain an extension of time to elect portability under section 2010(c)(5)(A). Under Regs. Simplified Method for Estate Tax Portability Provided in Rev. The IRS is making this simplified method available for all eligible estates through January 2, 2018. IRS has provided a permanently available simplified method for estates to obtain an extension of time to make the estate tax portability election. New simplified method to obtain an extension to elect ... For 2019, the exemption has been adjusted for inflation to $11.4 million per taxpayer, and $22.8 million per married couple. 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. Proc. July 2017. Estate Administration Update: A Simplified Procedure for ... Proc. Estate Planning Series: Portability Must be Addressed by ... 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. Recently, the IRS issued Revenue Procedure 2017-34 (the "Revenue Procedure"), providing a simplified process for certain estates requiring an extension of time to make a portability election . 2017-34 effective on June 9, 2017 to provide a simplified method to certain estates to make the portability election. 2017-34") to announce a new simplified procedure for particular estates to obtain an extension of time to file a federal estate tax return and make a "late" portability election.. First introduced into federal law in 2011 and made permanent in 2013, portability provides the . 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 . 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. 2014-18).Executors of estates of spouses who died in 2011, 2012, or 2013 and that did not timely file an estate tax return to make the portability election will have . 2010(c)(5)(A). If the filing threshold has not been met, this simplified method for requesting an extension of time to make a "portability" election is available. 2017-34 offers taxpayers a simplified method to extend the filing of Form 706, "United States Estate (and Generation Skipping Transfer) Tax Return" when filing for portability. 2017-34) a simplified method for electing portability in lieu of the estates obtaining a PLR. Proc. IRS Issues Revenue Procedure 2017-34, Announcing Simplified Method To Make A Late "Portability" Election Published on: July 15, 2017 | by Anne Marie Robbins In June of this year, the IRS published a revenue procedure that allows certain estates to make a late portability election if a timely election was not made. A portability election is irrevocable, unless an adjustment or amendment to the election is made on a subsequent return filed on or before the due date. . But that simpler method was only available up until the end of 2014. The Internal Revenue Service recently significantly simplified the process for making a late portability election for an individual's unused gift and estate tax exemption. Under IRC §2010 a surviving spouse may make an election to claim any lifetime transfer tax exclusion that was not used to reduce the . In the earlier years after these portability provisions were enacted, the IRS provided for a simplified method for obtaining an extension of time to make the portability election for estates that would not normally be required to file an estate tax return. 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. Note. 2017-34 A decedent is allowed an exclusion amount against the Federal Estate and Gift tax. (taxation), AEP®, TEP. 2017-34, creates a simplified method for making a late portability election, as long as the estate was only required to file Form 706 for the purpose of electing portability. The TCJA doubled the estate and gift tax lifetime exemption, from $5.49 million per taxpayer to $11.18 million per taxpayer. Proc. −Gross estate must be under the filing threshold and an estate tax return was not filed timely. IRS Issues Simplified Procedure for Obtaining Extension to Make Portability Election (Parker Tax Publishing June 2017) The IRS issued a revenue procedure, effective June 9, 2017, which provides a simplified method for certain taxpayers to obtain an extension of time to make a portability election under Code Sec. 2017-34. • The following criteria must be met: −Decedent must be survived by a spouse. 2017-34, estates for decedents passing after December 31, […] Proc. The simplified method is available for the estates of decedents that have no filing requirement under section 6018(a), and can be used before Jan. 2, 2018, or the second anniversary of the decedent's date of death, whichever is later. 20.6075-1and 20.6081-1. This is a great benefit to the many executors (and their practitioners) who may miss this deadline. This revenue procedure provides a simplified method for certain taxpayers to obtain an extension of time to make a portability election. 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. elect portability.16 Accordingly, the final regulations on this subject adopt the rules of the 2012 temporary regulations without change.17 Requirement of a "Complete and Properly Prepared" Estate Tax Return for Portability Election . But that simpler method was only available up until the end of 2014. 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. Summary. IRS Provides Simplified Method to Obtain Extensions By Stuart R. Josephs, CPA Rev. To prevent inadvertent loss of portability, the IRS rolled out some methods that allow a late filing of Form 706 to be deemed timely for purposes of making this election. Proc. the filing threshold has not been met, Revenue Procedure 2017-34 provides a simplified method for certain taxpayers to obtain an extension of time under § 301.9100-3 of the Procedure and Administration Regulations to make a "portability . Rev. Proc. 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. The IRS has issued Rev. The IRS is making this simplified method available for all eligible estates through January 2, 2018. The effect is that wills and revocable trusts for most married couples have become much more simplified in recent years. When a surviving spouse inherits almost everything and gets a double exemption when he or she passes away, there is also another benefit to the spousal election, according to the NAEPC Journal of Estate & Tax Planning in "Forget "Must Love Dogs" -- Go with "Must Love DSUE" or the Portability Election: Simplified Late Election Relief." There are seven (7) requirements for the decedents estate to take advantage of this simplified procedure. Proc. 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. 2014-18 provides an automatic extension for certain estates of decedents dying in 2011, 2012 and 2013 to elect portability. Portability Simplified Relief Method for Late Portability Election (cont.) If . simplified estate tax. 2014-18 ). to make a 'portability' election", a decedent's estate will have until the later of January 2, 2018 or the second anniversary of the decedent's death to file an estate tax return to . §301.9100-3 to file a Form 706 and elect portability without the need to apply for a private letter ruling and pay the associated fee.. The. 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 . 2014-18. (2) A QTIP election was stated in terms of a formula designed to reduce the estate tax to zero. 20.2010-2(a)(1), estates electing portability are considered to be required to file Form 706 under Sec. The simplified method is only available to estates that are not required to file an estate tax return based on the value of the gross estate and is effective June 9, 2017. The simplified method is available for the estates of decedents that have no filing requirement under section 6018(a), and can be used before Jan. 2, 2018, or the second anniversary of the decedent's date of death, whichever is later. For information on electing portability of the decedent's DSUE amount, including how to opt out of the election, see Section A of Part 6-Portability of Deceased Spousal Unused Exclusion. The release of Rev. −Decedent died after 12/31/10. Note. Cross References - Rev. Effective June 9, 2017, the IRS announced (see Rev. . The Portability Election: Simplified Late Election Relief. 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. "Portability" allows a surviving spouse to reduce his or her gift and estate taxes by claiming the unused portion of a deceased spouse's estate tax exclusion amount. A spousal portability election can be a good way to decrease an estate tax burden. Post Date: 7/17/17. 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 . 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 estate tax return must include a note at the top stating that it is "filed pursuant to Rev. On June 9, 2017, the Internal Revenue Service issued Revenue Procedure 2017-34, which is effective immediately and provides a simplified method to… Background 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. In early 2014, the IRS announced a simplified method of belatedly requesting an extension of time to file a Form 706 for purposes of this election. 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. 2014-18. While somewhat confusing, the form offers helpful instructions for completing and filing the return. When a person dies, the federal government allows a portion of their assets to be excluded from their estate, $5,490,000 in 2017. IRS Ruling Includes Estate Tax Exemption Portability Relief ScottHulse Issues Guide to Ruling Which Includes Retroactive Benefits for Some Widows and Widowers On January 27, 2014 the IRS announced a simplified procedure to provide retroactive tax relief to certain individuals whose spouses died after December 31, 2010 and before January 1, 2014. 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. Proc. To obtain a portability election extension, they can file a complete Form 706 by January 2, 2018, or the second anniversary of the decedent's death (whichever is later). Rather than seeking a private letter ruling and paying a user fee, the estate can file a properly completed estate tax return and write at the top "Filed Portability is the right of an executor to transfer or "port" the unused estate tax exemption from the first spouse to die to the second spouse to die. 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. Simplified Extension of Spousal Portability Election The IRS has issued a new rule that once again makes filing for an extension of time to make a spousal portability election simpler. Last Updated: 7/17/17. A portability election allows the surviving spouse to use any unused lifetime exclusion from the deceased spouse. Under this new two year filing window, which the IRS characterizes as a "simplified method for certain taxpayers to obtain an extension of time . 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 qualify for the simplified election, the executor must file a complete and properly prepared Form 706, on or before the later of Jan. 2, 2018, or the second anniversary of the decedent's date of death. 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. For decedent's dying in 2017, the inflation adjusted exclusion amount is $5,490,000. How to Void A QTIP Proc 2017-34, IRB 2017-26 which provides a simplified method for estates of decedents that are not otherwise required to file Form 706 under Code Section 6018(a) to obtain an extension of time to file Form 706 and elect portability: The taxpayer must be an executor of the estate of a decedent who was survived by a spouse . In this podcast, Bob Keebler covers Revenue Procedure 2014-18, which provides a simplified method for certain taxpayers to obtain an extension of time to make a portability election. . Making a spousal portability election, allows a surviving spouse to utilize a deceased spouse's estate tax exemption when the surviving spouse passes away. But that simpler method was only available up until the end of 2014. On June 9, 2017 the Internal Revenue Service (the "IRS") published Revenue Procedure 2017-34 ("Rev. The election to transfer a DSUE amount to a surviving spouse is known as the portability election. This simplified method is available to estates who would otherwise not be required to file a Form 706. Widow/widower 3a 3b Marital status of the decedent at time of death: Treasury Regulation Sec. Simplified Method for Estate Tax Portability Provided in Rev. 2017-34 to elect portability under Sec. Beyond these dates, portability won't be available unless the taxpayer is successful in obtaining a favorable PLR from the IRS. Ordinarily, to make this election, the executor must timely file a federal estate tax return (and not elect out) so that the surviving spouse effectively "inherits" the . Susan P. Rounds, JD, CPA, LL.M. The deceased spouse made no taxable gifts and did not have a federally taxable estate, and the spouse's personal representative makes a portability election to allow the surviving spouse to take into account the deceased spouse's $11.4 million DSUE amount. Proc. Proc. Effective June 9, 2017, Rev. Based on the Rev. The IRS issued Rev. This simplified method was available only on or before December 31, 2014. 2010 (c) (5) (A). Proc. However, that was only available through December 31, 2014. 6018(a), with a due date of nine months after the decedent's death or the last day of any period covered by an extension obtained under Regs. 2010 (c) (5) (a)." BACKGROUND In Revenue Procedure 2017-34 the IRS published a simplified method to obtain permission for an extension of time under Reg. On March 23, 2015, Troy . portability, which was first introduced as a temporary provision under the tax relief, unemployment re-authorization, and job creation act of 2010 and later made permanent under the taxpayer relief act of 2012, is an election made by a personal representative of an estate to transfer any unused estate tax exclusion, referred to as the "deceased … The first two mulligans. The simplified method is only available to estates that are not required to file an estate tax return based on the value of the gross assets in the estate. The Revenue Procedure is a simplified method to be used to make a late portability election. The spousal election can be a benefit in the future. Effective June 9, 2017, Revenue Procedure 2017-34 provides a simplified method whereby certain estates can obtain an extension of time to make an estate tax portability election. Under that scenario, using a greatly simplified calculation and the current tax rate of 40 percent, spouse B's estate will owe approximately $800,000 of federal estate tax because of the failure of spouse A's executor to elect for portability. 2017-34, creates a simplified method for making a late portability election, as long as the estate was only required to file Form 706 for the purpose of electing portability. 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. IRS has just made it easier and much less costly to file a late Form 706 to elect portability. Proc. Note. History Sec. Those eligible must be decedents . Some of these elections may require the posting of bonds or liens. Proc. 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. By making an estate tax portability election under U.S. code § 2010 (c), the unused portion of this benefit, the deceased spousal unused exclusion (or DSUE) can be transferred to a surviving spouse. Proc. In Revenue Procedure 2014-18 issued on Jan. 27, 2014, the Internal Revenue Service announced a simplified method for certain taxpayers to make a portability election for smaller estates that didn . On top of this generous amount, the IRS also allows for portability of the exemption between . The executor must state at the top that the return is "filed pursuant to Rev. Proc. 2010(c)(5)(A). The IRS has recently released Revenue Procedure 2017-34 (effective 6/9/2017) to provide a permanent simplified method for estates to make an election to pass the Deceased Spouse's Unused Exemption (DSUE) to the surviving spouse (aka the estate tax portability election). The IRS is also making the simplified method of this revenue procedure available after January 2, 2018, to estates during the two-year period . 2017-34 to elect portability under § 2010 (c) (5) (A)." Portability Election Simplified Method. (Once this simplified procedure expires, filing a late portability return will again require a . 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 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. The IRS issued a revenue procedure, effective June 9, 2017, which provides a simplified method for certain taxpayers to obtain an extension of time to make a portability election under Code Sec. Proc. On June 9, 2017, the IRS issued Rev. On June 9, 2017, the IRS issued Rev. Rev. Effective June 9, 2017, Rev. If the filing threshold has not been met (in other words; but for the need to make the portability election, the estate would not be required to file an estate tax return) Revenue Procedure 2017-34 PDF provides a simplified method for certain taxpayers to obtain an extension of time to make the "portability" election under § 2010(c)(5)(A) of the Internal Revenue Code. 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 … In a recent bulletin, the IRS issued Revenue Procedure 2017-34 which outlines a potential opportunity for certain taxpayers to obtain a time extension for those seeking to make a "portability election.". Proc. 2017-34 to simplify the method to obtain an extension of time to elect portability under section 2010(c)(5)(A). 20.2056(b)-7(h), Examples 7 and 8; (3) The QTIP election was a protective election under Treasury Regulation Sec. The portability election applies to estates of decedents who died after Dec. 31, 2010, and executors for those decedents must make a portability election on a federal estate tax return, according .