< Back to Thought Leadership

Extension to Make Portability Elections

By: Derek Gray, CPA, Director

On July 8, 2022, the Internal Revenue Service released Revenue Procedure 2022-32, now extending the time to make portability elections to five years.

What is a Portability Election?

A timely filed portability election allows for a widow/widower, here referred to as a surviving spouse, to utilize their deceased spouse’s unused estate and gift tax exclusion amount. Portability elections can be made by filing a Form 706, United States Estate (and Generation-Skipping Transfer) Tax Return and can result in large tax savings to taxpayers.

How Long Do You have to Make a Portability Election?

If a deceased spouse is not required to file an estate tax return, the IRS’s newly released Rev Proc 2022-32 allows for the simplified method to be used up to five years after the date of death of the decedent, as opposed to the former two years.

How Much is the Portability Election?

In 2018, the portability election amount was $11,180,000, meaning the surviving spouse could utilize any remaining gift tax exclusion amount from their deceased spouse up to $11,180,000. As of 2022, the portability election amount is up to $12,060,000.

What are the Benefits of Making a Portability Election Soon After Death?

It is important to look at the portability election amount and whether it may change. For example, if the current $12,060,000 drops to $6,500,000, then the surviving spouse would only be able to use their own $6,500,000 exemption. If instead, they had made the portability election, they would have their own exemption of $6,500,000 plus any unused exemption from their deceased spouse. This additional exemption amount could be the difference between there being a taxable estate or not.

With the new revenue procedure, taxpayers now have up to five years to decide on the portability election, providing a new opportunity to those whose spouses passed away between two and five years ago.

If you are a surviving spouse, your spouse passed away within the past five years, and the executor of the estate has not filed a Form 706 to make a portability election, contact your local Blue & Co advisor, or contact Derek Gray to see if you would benefit from filing an estate tax return.

indiana sales tax

New Indiana Sales Tax Rule for Not-For-Profits – Sales Tax Collection & Filing Threshold Increased

By Cory Schunemann, CPA, Manager at Blue & Co. Indiana’s 2023 Senate Enrolled Act (SEA) 417 made another change to the sales tax collection requirements for not-for-profits after 2022’s SEA 382. Not-for-profits with taxable retail sales in excess of $100,000 in the current or prior year are now required to collect and remit sales tax. […]

Learn More
Clipboard with paper that reads Employee Retention Credit | IRS Orders Immediate Stop to New Employee Retention Credit Processing – What You Need to Know | What You Need to Know About ERC

IRS Orders Immediate Stop to New Employee Retention Credit Processing – What You Need to Know

By Amy Sandlin, CPA, Tax Senior Manager at Blue & Co. On Thursday, Sept. 14, the IRS announced a moratorium on processing of new Employee Retention Credit (“ERC”) claims through at least December 31, 2023. This decision is in response to a flood of questionable claims and trusted tax advisors expressing a slew of concerns […]

Learn More

Changes to Medicare Bad Debt and S-10 Template Effective this Month

The new Medicare Bad Debt template (Exhibit 2A) and S-10 template (Exhibit 3B and 3C) have been finalized by Medicare and are now required for cost reporting periods ending on or after September 30, 2023. This deadline is quickly approaching, and Blue & Co. wants to be sure you are prepared. If you are feeling […]

Learn More