In June, the Internal Revenue Service issued proposed regulations and temporary regulations addressing the portability of a deceased spouse’s unused federal estate tax exemption. These regulations are “taxpayer friendly” and clarify several items which have been distressing fiduciaries and tax preparers.

Regulation highlights:

Estates which are below the threshhold required to file a federal estate tax return may still elect portability by filing Form 706. To help keep estate administration costs down, taxpayers may use “estimates”....