Legal Blog

The Weekly Scenario: Unlimited Marital Deduction

Question: What is the “unlimited marital deduction”? Answer: The federal unlimited marital deduction permits a person to leave unlimited amounts of property, free of federal estate tax, to his or her surviving spouse (assuming the spouse is a U.S. citizen). The transfer is accomplished through an unlimited deduction from estate and gift tax that postpones the transfers taxes on the property inherited from each other until the second spouse’s death. Likewise, most states exempt transfers to a surviving spouse from state estate taxes, if applicable. Comment: A provision called ‘portability’ was made permanent in 2013. Portability allows the person administering the estate of a deceased spouse to allocate any unused exemption amounts to the surviving spouse. This generally allows the surviving spouse to transfer about $10.8 million to their beneficiaries/heirs tax free.

ABOUT STEVE SHANE

Steve Shane Head Shot for webSteve Shane provides strategic counseling to clients in need of estate administration, charitable giving and business continuity planning while minimizing estate, gift, and generation-skipping transfer tax exposure. He offers legal guidance to clients on asset protection and the proper disposition of assets in accordance with the client’s objectives, while employing tax planning techniques such as the use of irrevocable trusts, life insurance planning, lifetime gifts and charitable trust. He is also experienced with drafting documents for business planning, the incorporation and application for exemption for Private Foundations and the administration of decedents’ estates. You can also connect with Offit Kurman via Facebook, Twitter, Google+, YouTube, and LinkedIn.

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