Form 706 Estate Tax - Simple Way To Elect Portability Of Unused Estate Tax Exclusion (DSUE)

[Romper]

My wife died in July 2023. I do not need to file a Form 706 for estate taxes but I would like to elect portability of her unused estate tax exclusion. That option is available in Part 6, Section C of Form 706. 

Form 706 has to be the most complicated form I've ever encountered.

Is there a simple way to elect portability without all the tables, worksheets, calculations and schedules?

Perhaps completing only Part 1 Decedent details and Part 6, Section C.

Thanks in advance

[M-MTax]

https://www.thetaxadviser.com/issues/2022/nov/updated-simplified-method-for-estate-portability-elect...

No way to make the election without filing 706 though.....you need to meet with an estate planning lawyer.

Sincere condolences

[Romper]

Thanks MMTaxMM
Got to love the title of the link - Simplified method...

[Anonymous_]

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@Romper wrote:

Got to love the title of the link - Simplified method...

I am very sorry for your loss.

The title appears to be humorous considering the complexity of Form 706 and related schedules. However, it actually is a simplified method because the only other method was to obtain a PLR (private letter ruling), which is absolutely nowhere near simple.

Regardless, preparing Form 706 is definitely not a DIY project and the audit rate is alarmingly high comparatively, particularly for those who try to prepare the return themselves. You need to look for an estates & trusts attorney in your area and ensure that the attorney has experience in preparing Form 706 (not all do).

[Romper]

Thankyou tagteam

I agree, Form 706 is not a DYI. Chances of getting right are virtually nil.

Given that we now have five years to elect portability, my best approach is to wait to see what the exclusion becomes when the current 12.9 million expires at the end of 2025.

Has anyone experienced the price for an attorney to do Form 706 just to elect the portability?

Given the complexity, I'm guessing "sticker shock" will be an understatement.

[Anonymous_ · Accepted solution]

The cost is going to vary across different areas of the country, but I can tell you that I've been associated with a firm where clients have paid north of $15,000 but that's for high-value estates (I know costs can rise even higher than that).

I'm not sure if this will actually result in "sticker shock" in your particular case, but I wouldn't count on getting away with much less than $1,500 for a bottom of the barrel type of return and around $2-3k would not be unreasonable. You do need to exercise a bit of caution because in virtually all instances, you get what you pay for (i.e., you might want to steer clear of anyone who gives you a quote that seems shockingly low). 

However, note (as you already did) that you do have roughly 5 years to make this decision and, obviously, a lot can change in that time period. As a result, you don't need to be in any hurry or make a snap decision.