Update: Rev. Proc 2014-18s Effect on Same-Sex Married Couples and Portability Elections
January 31, 2014
Authored by: Tiffany McKenzie and Kim Civins
Under the portability rules a surviving spouse can elect to have the deceased spouse’s unused estate tax exemption (currently $5.34 Million) added to the surviving spouse’s estate tax exemption amount. But to do this, a federal estate tax return has to be filed within 9 months of the death of the first spouse, even if there is no taxable estate for estate tax purposes. The federal estate tax return is the only way to take advantage of the portability election. The nine month time limit has proved to be an issue in regards to same-sex spouses, whose marriages were not recognized by the IRS until the Windsor decision on June 26, 2013. Click here, here, and here to read about the Windsor decision. We believed the Windsor decision may have opened the door to the otherwise “late” portability elections for same-sex spouses, but were not sure how