Estate & Trust Administration For Dummies, 2nd Edition
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Part 6 of Form 706 is where you elect Portability of Deceased Spousal Unused Exclusion (DSUE) for the estate. This list details what do for each section of Part 6:

  • Section A, Opting Out of Portability: Check the box to elect out of portability. Don’t complete B and C. If no estate tax return was filed for a decedent, he or she is assumed to have opted out of portability.

  • Section B, QDOT: If any assets of the estate are being transferred to a qualified domestic trust (QDOT), which would be because the surviving spouse isn’t a citizen of the United States, then check yes. Otherwise, check no. If you answer yes, the DSUE amount is deemed preliminary, until there’s a taxable event.

  • Section C, DSUE Amount Portable to Surviving Spouse: Complete this section only if electing portability. The amount portable to the surviving spouse will be the lesser of the basic exclusion amount in effect on the date of death of the decedent whose DSUE is being computed or the decedent’s applicable exclusion amount less the amount on line 5 of Part 2 – Tax Computation on Page 1 of the 706.

    Exclude amounts on which gift taxes were paid in doing this computation.

  • Section D, DSUE Amount Received from Predeceased Spouse(s): Report any DSUE amount received from the decedent’s last deceased spouse and any previously deceased spouses. Unused amounts from previously deceased spouses can’t be used on this return, but amounts used previously in making gifts must be reported here.

    The remaining DSUE amount from the last deceased spouse is carried forward to Line 9B of Part 2 – Tax Computation on Page 1 of the 706.

About This Article

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About the book authors:

Margaret Atkins Munro, EA, has more than 30 years of experience in trusts, estates, family tax, and small businesses. She lectures for the IRS annually at its volunteer tax preparer programs. Kathryn A. Murphy is an attorney with more than 20 years of experience administering estates and trusts and preparing estate and gift tax returns.

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