PROC. In order to elect portability of the decedent's unused exclusion amount (deceased spousal unused exclusion (DSUE) amount) for the benefit of the surviving spouse, the estate's representative must file an estate tax return (Form 706) and the return must be filed timely. Generally, the Gross Estate does not include property owned solely by the decedent's spouse or other individuals. In other words, in 2015 the gross estate must be valued less than $5.43 million in order for a request for a regulatory extension to be made. In this Part, taxpayers can opt out of electing to transfer any DSUE amount to Procedure In the FAQ, the IRS said that the closing letter cannot be requested until four months after Form 706 is filed. See also Publication 555, Community Property. Procedure In the FAQ, the IRS said that the closing letter cannot be requested until four months after Form 706 is filed. The responsibility for filing a Form 706 (United States Estate and Generation-Skipping Transfer) tax return to make the portability election in a timely manner falls to the estate’s executor, even if the estate tax return is not otherwise required to be filed. An official website of the United States Government. That provision would appear to make a closing letter largely immaterial for an estate that has no estate tax liability and the only reason Form 706 is filed is to elect portability. In addition, hardcopy account transcripts are available to authorized taxpayers making valid requests via mail or facsimile using Form 4506-T, Request for Transcript of Tax Return. If one exists, you may either That provision would appear to make a closing letter largely immaterial for an estate that has no estate tax liability and the only reason Form 706 is filed is to elect portability. Sue won't automatically "inherit" Bob's unused exemption. 2010-2 (a)(1), estates electing portability are considered to be required to file Form 706 under Sec. data, put and request legally-binding electronic signatures. CPAs and EAs may also handle most of the work, but cannot take care of probate matters and other situations where a law license is required. An estate tax return also must be filed if the estate elects to transfer any deceased spousal unused exclusion (DSUE) amount to a surviving spouse, regardless of the size of the gross estate or amount of adjusted taxable gifts. Some of these elections may require the posting of bonds or liens. Work from any device and share docs by email or fax. No user fee is required for submissions filed under this revenue procedure. Please refer to Transcripts in Lieu of Estate Tax Closing Letters for specific instructions on how to request an estate tax account transcript using TDS or by using Form 4506-T. Form 706 is due on or before nine months after the deceased spouse’s date of death; however, an automatic six-month extension can be requested by filing an IRS Form 4768, Application for Extension of Time To File a Return and/or Pay U.S. Estate (and Generation-Skipping Transfer) Taxes, on or before the due date for Form 706. An automatic six month extension of time to file the return is available to all estates, including those filing solely to elect portability, by filing Form 4768 on or before the due date of the estate tax return. Below are some of the more common questions and answers about Estate Tax issues. Based on current restrictions due to the declared National Emergency we will only accept a request for an estate tax closing letter by facsimile to 855-386-5127 or 855-386-5128. Under Code Sec. Will my same-sex spouse be considered a surviving spouse for purposes of the marital deduction for estate tax purposes? Form 706, United States Estate (and Generation-Skipping Transfer) Tax Return, is an Internal Revenue Service (IRS) form used by an executor of a … plan is being requested. 6018(a). Your financial institution may charge a fee for this service. However, the terms “spouse,” “husband and wife,” “husband,” and “wife” do not include individuals (whether of the opposite sex or the same sex) who have entered into a registered domestic partnership, civil union, or other similar formal relationship recognized under state law that is not denominated as a marriage under the laws of that state, and the term “marriage” does not include such formal relationships. What is included? a) The executor must file a complete and properly prepared Form 706 on or before the later of January 2, 2018, or the second annual anniversary of the decedent’s date of death. Please do not hesitate to contact our office if you have any questions about the final estate tax portability rules. Portability of Deceased Spousal Unused Exclusion 1. 20. By the time most estates reach $1,000,000, there is usually some complexity involved. Depending on how your 1/2 interest is held and treated under state law, and how it was acquired, you would probably only include 1/2 of its value in your gross estate. Portability has been part of the law since late in 2010. Convert them into templates for numerous use, incorporate fillable fields to gather recipients? Also, the Service will recognize a marriage of individuals of the same sex that was validly created under the laws of the state of celebration even if the married couple resides in a state that does not recognize the validity of same-sex marriages. The portability election is supposed to be made by filing a Form 706, United States Estate (and Generation-Skipping Transfer) Tax Return. The estate's representative may request an extension of time to file for up to six months from the due date of the return. However, if, based on the value of the gross estate and the amount of adjusted taxable gifts, the filing threshold has not been met, Revenue Procedure 2017-34 PDF 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” election under § 2010(c)(5)(A) of the Internal Revenue Code. Sec. Your bank may have an earlier cutoff time. Nor is the fair market value of an item of property to be determined by the sale price of the item in a market other than that in which such item is most commonly sold to the public, taking into account the location of the item wherever appropriate." Portability is not automatic and the election must be made on an estate tax return, the 706, within 9 months of death or within any extensions actually granted. For more information, see the related Tax Reform page. Estate and Gift Tax Exemptions: Portability and Form 706 November 8, 2013 With the year end fast approaching, there is no time to waste for those who want to take advantage of the current estate and gift tax exemptions. Rev. Portability was part of the Tax Relief, Unemployment Reauthorization, and Job Creation Act of 2010 and portability became effective for married persons dying on or after January 1, 2011. Because the $3 million is less than the $11 million, no federal estate taxes are actually due and no return is required. The closing letter will be prepared and issued to the executor at the address of record. § 20.2010-2(a)(1) provides that an estate that elects portability will be considered to be required to file a return under Code Sec. 2010(c)(5)(A), a portability election is effective only if made on a Form 706 that is filed within the time prescribed by law (including extensions) for filing such return. 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