IRS Revenue Procedure 2014-18 Extends Taxpayer Deadline to File Portability Elections

Beginning in 2011, the surviving spouse was able to inherit the portion of the deceased spouse’s unused estate tax exemption.  This was called portability of the exemption.  In order to qualify for portability the executor of the estate of a deceased spouse was required to timely file an Estate Tax return (Form 706) even though no estate tax was due and the estate tax return was not otherwise required. Many surviving spouses were not familiar with this rule and missed the filing deadline.  A new Revenue Procedure released by the IRS in January, extends the deadline for filing Form 706 for the purpose of electing portability until December 31, 2014. The deceased spouse must have died after December 31, 2010 and before December 31, 2013 in order to be eligible for this extension.

This Revenue Procedure has direct consequences for same sex couples whose marriages were recognized by the 2013 Supreme Court decision, United States v. Windsor. If the first spouse died during the aforementioned period, the spouse’s estate may file the Form 706 to elect portability to the surviving spouse.