Portability makes it unnecessary for spouses
to use bypass trusts solely to preserve the federal exemption amount. As with
any new process there is a shakeout period, though.
The good news has resounded and
there is much to celebrate with the passing of ATRA 2012 (or the Fiscal Cliff
deal). One particularly positive element of ATRA 2012 is the continuation of
certain estate and gift tax laws.
A recent Forbes article titled “A
Married Couple's Guide To Estate Planning,”
explores some important considerations when it comes to fundamental estate
As so many of us hoped it would,
the fiscal cliff-bridging budget extended the provision known as “portability.”
As you may know, portability is the ability to pack up the unused tax exemption
of the first spouse – that is, their gift/estate tax exemption – and pass it on
to the surviving spouse. The surviving spouse doesn’t have to worry quite as
much about triggering the estate tax when they pass. Why? Because they now have
everything they own plus everything their spouse left them, and all of it can
be sheltered from estate taxes by the estate tax exemptions of both spouses.
The original article has more to
say regarding how to secure this portability. For that matter, portability is
also a limited achievement and a limited kind of protection between married
There is more to “portability”
and proper estate planning than meets the eye, so be sure to consult with your
estate planning attorney on this matter.
(January 9, 2013) “A
Married Couple's Guide To Estate Planning”[updated to ATRA 2012]