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with careful consideration and planning, during life and at death but only if the filing requirement, but the IRS continued
can help ensure the parties to a transac- executor of the decedent’s estate timely to issue numerous letter rulings. This
tion can claim rightful deductions for files Form 706, United States Estate (and placed a “significant burden” on its avail-
accrued liabilities that may exist when a Generation-Skipping Transfer) Tax Re- able resources (see Rev. Proc. 2022-32).
transaction closes. turn. Regs. Sec. 20.2010-2(a)(1) estab- The IRS noted that a “significant percent-
From Jason Borkes, CPA, lishes the requirements for a timely filed age” of the letter rulings were received
Irvine, Calif. portability election and provides that the from estates of decedents who died
due date of an estate tax return required within five years preceding the date of the
to elect portability is nine months after extension request. Accordingly, Rev. Proc.
Estates, Trusts & Gifts the decedent’s date of death or the last 2022-32 extends the portability election
day of the period covered by an exten- period to on or before the fifth anniver-
Updated simplified method sion if an extension of time for filing has sary of the decedent’s date of death.
for estate portability elections been obtained. After Form 706 is timely
available filed, the portability election is automati- How does an estate’s executor
On July 8, 2022, the IRS released Rev. cally made for estates required to file, obtain relief for a late portability
Proc. 2022-32, which updates and ex- unless affirmatively stated otherwise by election?
pands the simplified method for estates the estate’s executor on the return. Once The updated simplified method is
to obtain an extension of time to make made, the election is irrevocable. An es- available only if the estate’s executor was
a portability election under Sec. 2010(c) tate’s executor is required to file an estate not required to file an estate tax return
(5)(A). The revenue procedure became tax return in all cases where the gross es- and did not timely file an estate tax return
effective the day it was released, super- tate exceeds the basic exclusion amount (see Regs. Sec. 20.2010-2(a)(1)) and
sedes Rev. Proc. 2017-34, and allows es- in effect under Sec. 2010(c), which for the decedent died after Dec. 31, 2010;
tates with no filing requirement under 2022 is $12,060,000 (see Sec. 6018(a)). was survived by a spouse; and was a U.S.
Sec. 6018(a) to obtain an extension to citizen. To qualify for relief for a late
make a portability election up until the Why was the simplified method portability election, the estate’s executor
fifth anniversary of a decedent’s date of updated? must complete and properly prepare Form
death, subject to certain requirements. Treasury and the IRS first provided a 706 on or before the fifth anniversary of
simplified method in Rev. Proc. 2017-34, the decedent’s date of death and must
What are portability elections? which was available for a period extending state at the top of Form 706 that it is
Estate portability elections stem from to the second anniversary of the dece- “filed pursuant to Rev. Proc. 2022-32 to
Sec. 2010(c)(5)(A), which provides that dent’s date of death. An underlying inten- elect portability under § 2010(c)(5)(A).”
a deceased spousal unused exclusion tion of Rev. Proc. 2017-34 was to lessen If extension relief is granted, and it is
(DSUE) amount becomes available to a the need for private letter rulings to grant subsequently determined that an estate tax
surviving spouse’s subsequent transfers portability extensions for estates with no return was required under Sec. 6018(a),
based on the value of the gross estate and
taxable gifts, the extension will be deemed
null and void ab initio.

What happens if relief is
granted?
If relief is granted under Rev. Proc.
2022-32, the decedent’s spouse or the
spouse’s estate can apply the DSUE
amount to transfers made on or after
PHOTO BY DNY59/GETTY IMAGES tion of the DSUE amount to the sur-
the decedent’s date of death. If applica-
viving spouse’s transfers subsequently
results in an overpayment of gift or
estate tax by either the spouse or the
spouse’s estate, no claim for credit or

November 2022 9
www.thetaxadviser.com refund may be made if the Sec. 6511(a)