Late portability relief depends on estate size

Plain-English summary

Chief Counsel explained the available paths after an estate missed the Form 706 deadline for electing portability. If the gross estate exceeded $5 million, the filing obligation was statutory and no late-election relief was available, even if the marital deduction eliminated estate tax. If the gross estate was below $5 million, the estate could request relief through the private letter ruling process and would likely receive it. Simply filing a late Form 706 would not make an effective portability election.

Ruling snapshot

• Question: What relief is available after an estate misses the Form 706 deadline for electing portability?
• Outcome: advice given
• Key authorities: IRC § 2010(c)(5)(A)

Full text (IRS public release)

ID: CCA_2016101412175229
UILC: 2010.04-00

Number: 201650017
Release Date: 12/9/2016
From:
Sent: Friday, October 14, 2016 12:17:52 PM
To:
Cc:
Bcc:
Subject: RE: section 2010

I am working from home today, and then after today I’m out until Oct. 26.

If the taxpayer had a GROSS ESTATE of more than $5 million – no relief is available to him at all, even if the estate is nontaxable due to the marital deduction. The taxpayer had an absolute obligation to file a Form 706 within 9 months of date of death and having failed to do so, the election for portability is missed.

If the taxpayer had a GROSS ESTATE of less than $5 million, having missed the ability of timely filing a Form 706, the taxpayer’s only recourse for obtaining the portability election is to seek relief through the private letter ruling process. The relief will likely be granted. Merely filing a late Form 706 would be ineffective in making this election and the election will not be respected.