When you think about estate planning, tools like wills and trusts often take center stage. But there’s another strategy that could save your family millions—and it’s often overlooked.
It’s called portability, and while it can be a powerful way to reduce or eliminate estate taxes for married couples, it’s not automatic. At Duncan Legal, PC, we help families across Colorado understand the nuances of portability and decide whether it’s the right fit for their estate plan.
What Is Portability?
Portability allows a surviving spouse to inherit the unused portion of their deceased spouse’s federal estate tax exemption. As of 2025, that exemption is $13.99 million per person, which means a couple could potentially protect nearly $28 million from federal estate taxes—if portability is properly elected.
But this benefit doesn’t happen by default. To claim portability, the estate of the first spouse to pass away must file a federal estate tax return (Form 706)—even if that estate isn’t large enough to owe any estate tax.
Why Portability Is Especially Important Right Now
Under current federal law, the historically high estate tax exemption is scheduled to sunset at the end of 2025, reverting to an estimated $7 million per person (adjusted for inflation).
If this happens, families who secured portability before the sunset could retain the higher exemption—even if the surviving spouse passes away in a lower-exemption era. This makes timely planning even more critical.
The Limitations of Portability
While portability can be a great safety net, it’s not the best choice for every family—and it has some limitations to consider:
- It’s a Post-Death Election
Portability must be elected within nine months of the first spouse’s death (extensions may apply). If the deadline is missed, the exemption is lost. - No Help with GST Tax
Portability does not apply to the generation-skipping transfer (GST) tax, so it won’t help if you plan to leave assets to grandchildren or future generations. - State Estate Taxes
Some states impose their own estate taxes and do not recognize portability, which can create surprise liabilities even when federal estate tax is avoided. (Note: Colorado does not currently have a state estate tax, but this could change in the future.)
Is Portability the Right Tool for You?
Portability is just one of many estate tax planning strategies. Depending on your goals and your family’s unique situation, tools like irrevocable trusts, charitable giving, and lifetime gifting may provide more flexibility or greater savings.
But when used correctly—and on time—portability can be a powerful tool to protect your legacy.
Let’s Make Sure Your Plan Is Ready—When It Matters Most.
At Duncan Legal, PC, we take pride in helping Colorado families create thoughtful, customized estate plans that provide peace of mind today and clarity for the future.
Visit Us: 6436 S Racine Cir, Ste 227, Centennial, CO 80111
Call Us: (303) 394-2358
Learn More: www.duncanlegal.com
Duncan Legal, PC
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