Portability of the deceased spousal unused exclusion (DSUE) is the federal rule that lets a surviving spouse add a late spouse’s unused estate and gift tax exemption to their own, but only when the executor affirmatively elects it by filing IRS Form 706. The amount that carries over is the Deceased Spousal Unused Exclusion, or DSUE, amount, and the election is not automatic.
Portability of the deceased spousal unused exclusion lets a surviving spouse use a late spouse’s leftover federal exemption. For 2026 decedents the basic exclusion is $15,000,000 per person (Source: IRS Rev. Proc. 2025-32), so a couple can shelter up to $30,000,000. Claiming DSUE requires a timely, complete Form 706 election under 26 U.S.C. sec. 2010(c)(5)(A); it never happens on its own.
What is portability of the deceased spousal unused exclusion (DSUE)?
Portability of the deceased spousal unused exclusion is a federal provision that lets the executor of a deceased spouse’s estate transfer that spouse’s unused estate and gift tax exemption to the surviving spouse. The transferred figure is the Deceased Spousal Unused Exclusion, or DSUE, amount (Source: 26 U.S.C. sec. 2010(c)(4)). It applies only to federal transfer tax, not to state estate taxes.
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Under the statute, a surviving spouse’s applicable exclusion amount equals their own basic exclusion amount plus the DSUE amount received from the last deceased spouse (Source: 26 U.S.C. sec. 2010(c)(2)). This stacking is the mechanism that can effectively double the amount a married couple shields from federal estate tax.
For the broader picture of the exemption itself, see the Q3 Advisors explainer on the 2026 estate tax exemption. This page focuses narrowly on the portability election: what the DSUE is, how to claim it, and the deadlines that govern it.
How does the portability election work between spouses?
The portability election works by letting the first spouse’s leftover exemption follow the surviving spouse. The executor computes the DSUE on the first spouse’s Form 706 and elects to transfer it; the survivor then stacks that DSUE on top of their own $15,000,000 exclusion (Source: 26 U.S.C. sec. 2010(c)(2)). Only DSUE from the most recent deceased spouse may be used.
A married couple commonly relies on the unlimited marital deduction to pass assets to the survivor free of federal estate tax at the first death. That deduction can leave the first spouse’s exemption entirely unused. Portability captures that otherwise wasted exemption, but only if the election is made on a timely Form 706.
The core limit is the last-deceased-spouse rule. A surviving spouse may use DSUE only from their most recent deceased spouse. If the survivor remarries and that second spouse also dies, DSUE from the first marriage can be lost and is replaced by whatever DSUE the newer estate elects, if any (Source: 26 U.S.C. sec. 2010(c)(4)). This remarriage trap is a reason not to delay a first spouse’s filing.
What is the DSUE amount and how is it calculated?
The DSUE amount is the portion of a deceased spouse’s federal exemption left unused at death and passed to the survivor. By statute it is the lesser of (A) the basic exclusion amount, or (B) the last deceased spouse’s applicable exclusion minus the amount on which tentative tax was determined for that estate (Source: 26 U.S.C. sec. 2010(c)(4)). The figure is computed on Form 706, Part 6, Section C.
In plain terms, if a spouse dies in 2026 having used none of their $15,000,000 exemption and the executor elects portability, up to $15,000,000 of DSUE may pass to the survivor (Source: IRS Rev. Proc. 2025-32). Added to the survivor’s own $15,000,000, the combined federal shield can reach $30,000,000.
The DSUE that transfers reflects the exemption actually left unused. Amounts consumed by lifetime taxable gifts or by bequests to non-spouse heirs reduce what remains to port. The executor performs the DSUE computation in Part 6, Section C of Form 706, and the surviving spouse or their executor later reports the received DSUE when using it (Source: IRS Instructions for Form 706, 09/2025).
Is the portability election automatic?
No. The portability election is never automatic. A surviving spouse receives the DSUE only if the first spouse’s executor files a complete, timely Form 706 that computes the amount (Source: 26 U.S.C. sec. 2010(c)(5)(A)). On a timely return, portability is the default result: an estate that does not want it must affirmatively opt out by checking the box in Part 6, Section A.
The distinction matters. Filing a timely Form 706 elects portability by default, so no separate affirmative box is required to claim it (Source: IRS Instructions for Form 706, 09/2025, Part 6). The only affirmative act on the form is the opposite one: checking the Part 6, Section A box to decline portability.
The frequent and costly failure is simply not filing at all. Because many surviving spouses’ estates fall below the filing threshold, executors sometimes assume no return is needed, and the deceased spouse’s exemption is then lost for good, even though no tax was ever owed.
Do you have to file Form 706 to elect portability?
Yes. Form 706, the United States Estate (and Generation-Skipping Transfer) Tax Return, is the only way to elect portability of the deceased spousal unused exclusion. DSUE transfers only if the executor files the return and makes the election (Source: 26 U.S.C. sec. 2010(c)(5)(A)). There is no shorter form, letter, or automatic default outside a filed Form 706.
An estate must file a complete Form 706 to port the DSUE even when it owes no estate tax. The election is made on the return itself, and no other IRS filing preserves the unused exemption for the surviving spouse.
Filing when the estate owes no tax and is below the threshold
An estate can, and often should, file Form 706 to elect portability even when it is below the filing threshold and owes zero estate tax. For 2025 decedents, Form 706 is otherwise required only if the gross estate plus adjusted taxable gifts exceeds $13,990,000, but the return is permitted whenever the executor elects DSUE, regardless of estate size (Source: IRS Instructions for Form 706, 09/2025).
A below-threshold estate that skips Form 706 keeps its current estate tax at zero, but it generally forfeits the deceased spouse’s exemption for the survivor’s future use. The zero-tax result at the first death and the loss of the exemption are separate outcomes: skipping the return does not lower any tax, it only surrenders the DSUE.
How long do you have to file for portability?
The standard deadline to file Form 706 for a portability election is nine months from the date of death, extendable to roughly fifteen months by filing Form 4768 by the original due date (Source: IRS Instructions for Form 706, 09/2025). Estates not otherwise required to file may elect portability within five years under Revenue Procedure 2022-32, with a required notation on the return.
For estates not otherwise required to file, the longer, simplified window is meaningful. Under Revenue Procedure 2022-32, an estate filing solely to elect portability may file Form 706 on or before the fifth anniversary of the decedent’s death (Source: IRS Rev. Proc. 2022-32). This relief is automatic, carries no user fee, and replaced the earlier two-year window.
The late return must carry a specific notation at the top: “Filed Pursuant to Rev. Proc. 2022-32 to Elect Portability under section 2010(c)(5)(A)” (Source: IRS Rev. Proc. 2022-32). Missing that notation can defeat the relief.
| Situation | Deadline from date of death | Mechanism |
|---|---|---|
| Standard Form 706 filing | 9 months | File Form 706 |
| With automatic extension | About 15 months | File Form 4768 by original due date |
| Estate not otherwise required to file (portability-only) | 5 years | Rev. Proc. 2022-32, automatic, no user fee, with required notation |
The 2026 rules: OBBBA made the $15M exemption permanent
The 2026 federal basic exclusion amount is $15,000,000 per person, set permanently by the One Big Beautiful Bill Act (OBBBA), Public Law 119-21, signed July 4, 2025 (Source: IRS Rev. Proc. 2025-32). OBBBA canceled the scheduled end-of-2025 sunset that would have cut the exemption roughly in half, and set annual inflation indexing to begin in 2027. The top estate tax rate remains 40%.
For 2025 decedents, the basic exclusion amount is $13,990,000 (Source: IRS Instructions for Form 706, 09/2025). Many older portability guides still reference the pre-OBBBA sunset or an unindexed figure near $7,000,000; those are out of date. The current permanent figure is $15,000,000 for 2026, indexed from 2027 forward.
Combining two 2026 exemptions through portability can shelter up to $30,000,000 for a married couple. The table below shows the per-person and combined figures across the transition.
| Item | 2025 | 2026 |
|---|---|---|
| Basic exclusion per person | $13,990,000 | $15,000,000 |
| Potential combined (couple, with portability) | $27,980,000 | $30,000,000 |
| Top estate and gift tax rate | 40% | 40% |
| Annual gift tax exclusion | $19,000 | $19,000 |
| GST exemption (not portable) | $13,990,000 | $15,000,000 |
Is the GST exemption portable?
No. The generation-skipping transfer (GST) tax exemption is not portable to a surviving spouse. Portability under Section 2010(c) covers only the estate and gift basic exclusion amount, while the GST exemption sits separately under Section 2631(c). Nothing in the DSUE rules carries the GST exemption over, so each spouse’s $15,000,000 GST exemption is used or lost at their own death.
For 2026 the GST exemption equals the basic exclusion amount, $15,000,000, but it does not transfer between spouses the way DSUE does (Source: 26 U.S.C. sec. 2631; IRS Rev. Proc. 2025-32). Multi-generational planning therefore often relies on a reverse-QTIP election under Section 2652(a)(3) rather than portability (Source: Congressional Research Service report IF13053).
Portability vs. a bypass (credit shelter) trust
Portability and a bypass trust (also called a credit shelter trust) are two ways to preserve a first-deceased spouse’s exemption. Portability is simpler and generally preserves a basis step-up at each death, while a bypass trust removes future appreciation from the survivor’s taxable estate and can add creditor and remarriage protection. The right choice depends on asset growth, state of residence, and family circumstances.
| Factor | Portability (DSUE) | Bypass / credit shelter trust |
|---|---|---|
| How exemption is preserved | DSUE ported via Form 706 election | Assets funded into an irrevocable trust at first death |
| Future appreciation | Grows in survivor’s taxable estate | Generally excluded from survivor’s estate |
| Basis step-up at second death | Generally available on survivor’s assets | Generally not on trust assets |
| State estate tax | Usually no help (few states allow portability) | Can shelter at state level |
| Creditor / remarriage protection | Limited | Often stronger |
| GST planning | GST exemption not portable | Can be structured for GST |
Which approach fits depends on expected asset growth, state of residence, blended-family dynamics, and creditor exposure. With a combined federal exclusion that can reach $30,000,000 in 2026 (Source: IRS Rev. Proc. 2025-32), some families may weigh a portability election chiefly for the second basis step-up and appreciation buffer rather than for federal tax exposure alone. The figures are set by statute and could change.
Does portability apply to state estate taxes?
Generally no. Portability of the deceased spousal unused exclusion is a federal rule and does not extend to most state estate taxes. Several states plus the District of Columbia levy their own estate tax, and most do not offer a state-level portability election. Hawaii and Maryland are documented exceptions that provide a form of state portability of a deceased spouse’s exemption.
Because most estate-tax states do not offer portability, a first-deceased spouse’s state exemption can be lost without separate planning, which is one reason residents of those states weigh a bypass trust (Source: Hawaii Instructions for Form M-6; Maryland Code, Tax-General sec. 7-309). State rules and exemption amounts change over time, so the current-year rules for the relevant state govern. For how the federal figures fit together, see the Q3 Advisors guide to the 2026 estate tax exemption.
Worked example: two spouses’ estates (2026 numbers)
This example shows how a portability election preserves a first-deceased spouse’s $15,000,000 exemption for the survivor, using 2026 figures. It assumes both spouses are U.S. citizens, that all numbers are hypothetical, and that the executor files a timely Form 706 at the first death. The figures are illustrative only and are not a projection of any particular result.
- Spouse A dies in 2026 with a $6,000,000 estate, leaving everything to Spouse B under the unlimited marital deduction. No estate tax is due, and Spouse A’s $15,000,000 exemption is entirely unused (Source: IRS Rev. Proc. 2025-32).
- Spouse A’s executor files Form 706 within nine months (or under the Rev. Proc. 2022-32 five-year window, since the estate is not otherwise required to file) and elects portability. A DSUE of $15,000,000 transfers to Spouse B.
- Spouse B now has an applicable exclusion of $30,000,000: their own $15,000,000 plus the $15,000,000 DSUE (Source: 26 U.S.C. sec. 2010(c)(2)).
- Spouse B later dies with a combined estate of $28,000,000. Because that is below the $30,000,000 applicable exclusion, no federal estate tax is due.
Had the executor not filed Form 706 at Spouse A’s death, Spouse B would have only a single $15,000,000 exemption, and $13,000,000 of the estate could have been exposed to the 40% top rate (Source: IRS Instructions for Form 706, 09/2025). The election, made on a return that itself owed no tax, is what preserved the second exemption. Readers coordinating estate steps with lifetime tax moves sometimes review a Roth conversion strategy and how much to convert to Roth alongside it.
Filing a portability-only Form 706 in practice
A portability-only Form 706 is filed by an estate not otherwise required to file that files solely to transfer the DSUE. A Treasury regulation lets such estates report a good-faith estimate of total gross estate for certain marital or charitable property, rather than an exact appraised value (Source: Treas. Reg. sec. 20.2010-2(a)(7)(ii)). This estimate rule does not apply to property whose value affects a nonmarital or noncharitable transfer.
- Confirm the estate is not otherwise required to file, which opens the Rev. Proc. 2022-32 five-year window (Source: IRS Rev. Proc. 2022-32).
- Complete Form 706, compute the DSUE in Part 6, Section C, and do not check the opt-out box in Part 6, Section A (Source: IRS Instructions for Form 706, 09/2025).
- Add the required notation at the top of the return citing Rev. Proc. 2022-32.
- File within the applicable deadline, and retain records supporting reported values.
Estate tax filings interact with the rest of a retirement plan, including account titling, beneficiary strategy, and the timing of taxable income. Readers weighing lifetime moves alongside estate planning sometimes review required minimum distributions for 2026 and the net investment income tax for 2026. These are separate topics; portability itself concerns only the federal transfer tax exemption.
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Frequently asked questions
How does portability of the estate tax exemption work?
The executor of the first spouse to die files Form 706, computes the unused exemption in Part 6, Section C, and elects to transfer it. The surviving spouse then stacks that DSUE on top of their own $15,000,000 basic exclusion amount (Source: 26 U.S.C. sec. 2010(c)(2)). Only DSUE from the most recent deceased spouse may be used, under the last-deceased-spouse rule.
How long do you have to file for portability?
The standard deadline is nine months from the date of death, extendable by six months with Form 4768 for roughly fifteen months total (Source: IRS Instructions for Form 706, 09/2025). Estates not otherwise required to file that file only to elect portability may file within five years under Revenue Procedure 2022-32, adding the required notation to the return.
Is the portability election automatic?
No. Portability requires a complete, timely Form 706; taking no action forfeits the DSUE (Source: 26 U.S.C. sec. 2010(c)(5)(A)). On a timely return, portability is the default result, and an estate that does not want it opts out by checking the box in Part 6, Section A. A common failure is assuming no return is needed because no tax is owed.
What is the deceased spousal unused exclusion amount?
The DSUE amount is the unused portion of a deceased spouse’s federal exemption passed to the survivor. By statute it is the lesser of the basic exclusion amount or the last deceased spouse’s applicable exclusion minus the amount on which tentative tax was determined (Source: 26 U.S.C. sec. 2010(c)(4)). For a 2026 death with none used, up to $15,000,000 can transfer.
Do you have to file Form 706 to elect portability?
Yes. DSUE transfers only if the executor files Form 706 and makes the election; there is no other way to claim it (Source: 26 U.S.C. sec. 2010(c)(5)(A)). When a complete, timely Form 706 is filed for an estate with a surviving spouse, portability is the default unless the estate checks the opt-out box in Part 6, Section A.
What is the five-year rule for portability?
The five-year rule comes from Revenue Procedure 2022-32. An estate not otherwise required to file may elect portability by filing Form 706 on or before the fifth anniversary of the decedent’s death (Source: IRS Rev. Proc. 2022-32). The relief is automatic, carries no user fee, and requires a specific notation on the return citing the revenue procedure.
Can you elect portability if the estate is below the filing threshold?
Yes. An estate may file Form 706 to elect portability even when it is below the filing threshold and owes no tax; the return is permitted whenever the executor elects to transfer DSUE, regardless of size (Source: IRS Instructions for Form 706, 09/2025). Such estates generally qualify for the five-year window under Revenue Procedure 2022-32.
Is the GST exemption portable?
No. The generation-skipping transfer tax exemption is not portable to a surviving spouse. Portability under Section 2010(c) applies only to the estate and gift basic exclusion amount, while the GST exemption is a separate amount under Section 2631(c) that each spouse uses or loses at their own death (Source: 26 U.S.C. sec. 2631). Multi-generational planning often uses a reverse-QTIP election instead.
Sources
26 U.S.C. sec. 2010(c) (Deceased Spousal Unused Exclusion), law.cornell.edu/uscode/text/26/2010. 26 U.S.C. sec. 2631 (GST exemption), law.cornell.edu/uscode/text/26/2631. Treas. Reg. sec. 20.2010-2 (portability election and special reporting rule for estates not required to file), ecfr.gov. IRS Instructions for Form 706 (Rev. Sept. 2025), irs.gov/instructions/i706. IRS Rev. Proc. 2022-32 (late portability election relief), irs.gov/pub/irs-drop/rp-22-32.pdf. IRS Rev. Proc. 2025-32 (2026 inflation adjustments; sec. 2.14 estate and GST exemption; sec. 4.42 annual gift exclusion), irs.gov/pub/irs-drop/rp-25-32.pdf. One Big Beautiful Bill Act, Public Law 119-21 (July 4, 2025). Congressional Research Service report IF13053 (Generation-Skipping Transfer Tax). Hawaii Instructions for Form M-6 (Hawaii Estate and Generation-Skipping Transfer Tax Return), tax.hawaii.gov. Maryland Code, Tax-General sec. 7-309 (Maryland estate tax; spousal portability).
