Portability of the federal estate tax exemption between married couples means that if the first spouse dies and the value of his or her estate does not require the use of all his or her estate tax exemption, then the amount that was not used may be transferred to the survivor for their use. This is called the “DSUEA,” the Deceased Spouse’s Unused Exemption Amount.

In order to obtain the benefit of portability, after the death of the first spouse, an estate tax return must be filed in a timely manner. This is an obligation that may not otherwise be required given the large estate tax exclusion currently available. After the first death of a couple, the survivor must assess the merits of filing the return. A limitation on the effective use of a Portability election is that if the survivor later remarries and his or her new spouse dies before he or she does, the unused exemption from the prior spouse is lost.