• IRS Notice 2012-21 (3/5/2012)
  • April 5, 2012
  • Law Firm: Proskauer Rose LLP - New York Office
  • In order for a surviving spouse to retain use of a deceased spouse's unused estate tax exemption, he or she must make a portability election on a timely filed federal estate tax return for the deceased spouse, even if no federal return needs to be filed because the decedent's assets were below his or her remaining federal estate tax exemption amount.

    Because taxpayers may have been unaware of this filing requirement, in Notice 2012-21 the IRS has granted a six-month extension for the filing of a federal estate tax return for a decedent who died in the first six months of 2011. This extension only applies if the decedent's gross estate was $5 million or less and if there is a surviving spouse.

    To take advantage of the extension, the decedent's estate must submit a Form 4768 (i.e., a request for an extension of time to file a return) within fifteen months of the date of the decedent's death. The form should reference Notice 2012-21 and may be submitted simultaneously with the estate tax return.