A Great Way to Minimize the Federal Estate Tax with Portability

You may be surprised that for most people, the federal estate tax is a voluntary tax. It is an old saw among estate planning attorneys that “you only pay if you don’t plan.” With recent changes in the federal estate tax law, portability provides a backup tool for those who fail to do lifetime estate tax planning. As a result, you may be able to minimize and eliminate federal estate taxes even if you did no planning. Here is how it works.

This new tool given to us by the tax law, called portability, allows married couples to use two estate tax exemptions. The result could be significant amounts in estate tax savings even if there was no lifetime planning and without dividing the couple’s assets. This option was first in the tax law in 2010 but