The instructions for Form 8971 (report of final estate value for assets to be distributed) are not exactly clear on whether the form must be filed where an estate tax return (706) is filed merely for porting deceased spousal unused exclusion amount (DSUEA):
The filing requirement for Form 8971 does not apply to an executor of an estate that is not required to file an estate tax return because the gross estate plus adjusted taxable gifts is less than the basic exclusion amount, but who does so for the sole purpose of making an allocation or election respecting the generation-skipping transfer tax. See the Instructions for Form 706, Form 706-NA, or Form 706-A for more information on the filing requirement for those forms.
However, Leimberg reports here the IRS informally says it will not require Form 8971 where the 706 is filed for portability only.
Learn more about portability and the Clayton election:
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David R. Duringer, JD, LL.M, is a concealed firearm instructor and tax lawyer specializing in business and estate planning. He is managing shareholder at Protective Law Corporation, serving Southern California from its Laguna Hills (Orange County) headquarters and a satellite office in Coronado (San Diego County).
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