Which term describes the portion of the exemption that is unused and can be transported to the surviving spouse?

Which term describes the portion of the exemption that is unused and can be transported to the surviving spouse?

• A. Gross estate
• B. Portable
• C. Net estate
• D. Deductions

Answer: (B)

In estate tax planning, each spouse has an exemption that shields a portion of assets from federal estate tax. When the first spouse dies, any unused portion of that exemption can be carried over to the surviving spouse. That ability to transfer the unused exemption is called portability. It allows the surviving spouse to apply a larger total exemption at their death, provided the necessary election is made (typically by filing Form 706). Gross estate refers to the total value of all assets at death before deductions. Net estate is what remains after deductions. Deductions are amounts subtracted from the gross estate (like debts, funeral expenses, and certain deductions such as the marital or charitable deduction). None of these describe carrying over unused exemption; portability specifically names that transferring concept.

In estate tax planning, each spouse has an exemption that shields a portion of assets from federal estate tax. When the first spouse dies, any unused portion of that exemption can be carried over to the surviving spouse. That ability to transfer the unused exemption is called portability. It allows the surviving spouse to apply a larger total exemption at their death, provided the necessary election is made (typically by filing Form 706).

Gross estate refers to the total value of all assets at death before deductions. Net estate is what remains after deductions. Deductions are amounts subtracted from the gross estate (like debts, funeral expenses, and certain deductions such as the marital or charitable deduction). None of these describe carrying over unused exemption; portability specifically names that transferring concept.