Portability Election
The portability election allows a surviving spouse to use any unused federal estate tax exemption from their deceased spouse’s estate, adding it to their own exemption. It is one of the most consequential and most frequently missed steps in estate administration — and its deadline is unforgiving.
What It Is
Each person has a federal estate tax exemption — the amount they can transfer at death free of federal estate tax. As of 2026, the exemption is scheduled to revert from its elevated post-2017 level to approximately half that amount (adjusted for inflation), making portability more strategically important for mid-sized estates.
When a spouse dies without using their full exemption — because their estate passed entirely to the surviving spouse under the marital deduction, for example — the unused portion is not automatically available to the survivor. To capture that unused exemption, the executor of the deceased spouse’s estate must file a federal estate tax return (Form 706) and make the portability election, even if no estate tax is owed.
The deadline for this election is generally nine months after the date of death, with a six-month extension available. The IRS has provided relief procedures for late portability elections in some circumstances, but the relief is not guaranteed. Estates that miss the deadline and cannot obtain relief permanently forfeit the deceased spouse’s unused exemption.
The benefit is concrete. If Spouse A dies with a $12 million exemption of which $4 million was used, Spouse B can port the remaining $8 million. Combined with their own $12 million exemption, the surviving spouse now has $20 million in sheltered transfer capacity — enough to protect a substantial estate from federal estate tax entirely.
Etymology
“Portability” in its everyday sense means the ability to carry something from one place to another. In estate tax, the exemption becomes portable — it can be carried from the deceased spouse’s estate to the survivor’s. The concept was introduced by the Tax Relief, Unemployment Insurance Reauthorization, and Job Creation Act of 2010 and made permanent by the American Taxpayer Relief Act of 2012.
A Concrete Example
A couple has a combined estate of $18 million, roughly evenly split. Spouse A dies in 2024 with an $8 million exemption unused (their estate passed entirely to Spouse B through the marital deduction). The executor files Form 706, makes the portability election, and captures the $8 million deceased spousal unused exclusion (DSUE). Spouse B now has their own exemption plus $8 million DSUE. When Spouse B dies with a $18 million estate, the combined exemption is sufficient to eliminate federal estate tax liability entirely. Without the portability election, Spouse B would have faced substantial estate tax on the excess above their individual exemption.
Common Misconception
Many surviving spouses and even some attorneys assume that because no estate tax is owed at the first spouse’s death — because everything passed to the survivor — no estate tax return needs to be filed. This is the portability trap. The return is required not to pay tax but to preserve the election. Skipping the return because no tax is owed is one of the most expensive estate planning errors a family can make, and it is made with surprising frequency.