Maximize Estate & Gift Tax Savings
The TCJA doubled the estate and gift tax exemption to $13.61M per person in 2024. By electing portability with Form 706, couples can shield up to $27.22M tax-free—making now the best time for estate planning before the 2026 sunset.
Maximize Your Benefit from the Ultra-Generous TCJA Estate and Gift Tax Exemption
The Tax Cuts and Jobs Act (TCJA), effective from 2018 through 2025, temporarily doubled the federal estate and gift tax exemption. For 2024, the inflation-adjusted amount is $13.61 million per person (or $27.22 million for married couples). This creates a powerful window of opportunity for high-net-worth individuals and families to minimize estate and gift tax liability through strategic planning.
What Is Portability in Estate Planning?
Portability allows the unused estate and gift tax exemption of a deceased spouse to be transferred to the surviving spouse.
This means the surviving spouse may combine their own exemption with their late spouse’s unused exemption, potentially doubling their tax-free transfer capacity.
To qualify, the surviving spouse must be a U.S. citizen.
The estate executor must file Form 706 (Estate Tax Return) in a timely manner to elect portability, even if no estate tax is owed.
Key Highlights
Feature | Details |
|---|---|
2024 Exemption Amount | $13.61M per person/$27.22M per married couple |
Portability | Deceased spouse's unused exemption can transfer to surviving spouse |
Unlimited Marital Deduction | Available only if the surviving spouse is a U.S. citizen |
IRS Form 706 Filing | Mandatory to elect portability, even for non-taxable estates |
Planning Tip | Always elect portability, even if the estate is below the threshold |
Why Portability Changed the Game
Before portability was introduced, families often had to:
Reallocate assets between spouses during life, or
Set up credit shelter trusts (bypass trusts) to ensure both spouses’ exemptions were fully used.
With portability, complex trust structures are often unnecessary—a simple Form 706 filing preserves the unused exemption.
Rules You Must Know
Maximum Transferable Amount: The lesser of the full exemption ($13.61M in 2024) or the unused exemption after other bequests.
Example: If a deceased spouse leaves $5M to children from a prior marriage, only $8.61M remains portable.
Most Recent Deceased Spouse Rule: A surviving spouse may only use the unused exemption of their most recently deceased spouse. This prevents “stacking” exemptions across multiple marriages.
Deadlines:
Form 706 must be filed within 9 months of death.
Automatic 6-month extension available via Form 4768.
Special relief (Rev. Proc. 2017-34) allows filing up to 2 years post-death if solely for portability.
Tax Planning Insight
Even if an estate is well below the current $13.61M threshold, electing portability is a smart long-term move.
The exemption amount is scheduled to sunset after 2025, likely cutting it in half.
Preserving your spouse’s unused exemption today could save your heirs millions in future estate taxes.
👉 Bottom line: Filing Form 706 for portability is like buying free insurance against future tax law changes.