Personal Finance & Estate › Income, gift, estate & real-estate taxes › Estate & lifetime gift exemption ($15M in 2026)
Portability of a deceased spouse's unused exemption (DSUE)
Since 2011; needs Form 706· Tax rule
Law or rule (2026)Set by statute, regulation or the agency; numbers change yearly.
A surviving spouse can add the late spouse's unused estate exemption to their own, but only if a Form 706 is filed.
See it on the Personal Finance & Estate map →How it works
If the first spouse dies using little of their $15 million exemption, the executor can elect to pass the unused amount (the DSUE) to the survivor, potentially sheltering $30 million. The election needs a complete estate tax return, Form 706, filed within nine months (15 with extension), even when no tax is owed; estates below the filing threshold get up to five years. The DSUE isn't inflation-indexed, and GST exemption doesn't carry over. If the survivor is widowed again, the newer DSUE replaces it.
Why it matters for you
Filing at the first death is cheap insurance against future exemption cuts, yet many families miss it. Ask the estate attorney or CPA right after the first death.
Think of it like
Like an unused tenant-improvement allowance that carries to the renewal, if you file the paperwork on time.
Rules, limits and sources (2026)
Created by the 2010 tax law for deaths from 2011 and made permanent in 2012; Treasury regulations (2015) and IRS Rev. Proc. 2022-32 (five-year late election) govern it.
Watch out for
Planners debate portability versus a bypass trust: portability gives heirs a second step-up, while a trust shelters growth, protects heirs and uses GST exemption.
Connections (2)
▸Portability of a deceased spouse's unused exemption (DSUE) passes a late spouse's unused share of Estate & lifetime gift exemption ($15M in 2026)Law or rule (2026)
How they connect
Each spouse has an estate exemption, $15 million in 2026. If the first to die uses little of it, often because everything passes to the survivor under the marital deduction, portability transfers the unused amount to the survivor, who can use it for lifetime gifts or at death, up to $30 million combined.
When it applies
Created for deaths after 2010 by the 2010 Tax Relief Act and made permanent by the American Taxpayer Relief Act of 2012.
The rule
IRC Sec. 2010(c)(4)-(5); Treasury Reg. 20.2010-2 requires a timely, complete Form 706.
Watch out for
The DSUE isn't indexed, so decades later it may lag the survivor's growing exemption; planners weigh that against bypass trusts.
▸Portability of a deceased spouse's unused exemption (DSUE) is elected on a Form 706 filed with Internal Revenue Service (IRS)Law or rule (2026)
How they connect
Portability happens only if the late spouse's executor files Form 706 with the IRS, computing the unused exemption (DSUE) and electing to pass it on. The IRS can examine that return to adjust the DSUE until the survivor's own estate is settled, so values and records must be kept long after the first death.
When it applies
Created by the 2010 Tax Relief Act for deaths from 2011 and made permanent in 2013; Revenue Procedure 2022-32 allows a late election within five years.
The rule
IRC Sec. 2010(c)(4)–(5) and Treasury regulations set the rules; IRS Form 706 instructions explain the election.
Watch out for
With the $15 million exemption now permanent, how many couples still need portability, and whether future laws will cut exemptions, is uncertain.