Always Elect Portability of the Estate Tax Exemption? Maybe … Maybe Not

• In Event: Tax Policy and Research

Abstract

The federal estate tax in the United States has been in place since 1916, and mired in controversy and extensive tax debate and planning since almost that time. The American Taxpayer Relief Act of 2012 eliminated one of the more debatable and confounding problems in the Code – the ability to “carry” one of the estate tax exemption amounts from one spouse to another.

This article discusses the election of portability of the exemption and how it can significantly reduce overall estate tax liability. On the other hand, there may be some significant non-tax reasons to not elect portability, and this paper points out six reasons why this might not be the case.

Author

• Robert J Walsh, University of Dallas