Document Type

Article

Publication Title

Estate Planning

Publication Date

2005

Abstract

In a decoupled state with a smaller exemption, full use of the federal estate tax exemption in the first decedent's estate will result in state death tax being due upon the first decedent's death (a result of the smaller state exemption). Conversely, if use of the federal estate tax exemption is limited in the decedent's estate to the (smaller) state exemption, then more federal (if not state) estate tax will likely be due upon the death of the surviving spouse. Limiting use of the exemption in the first estate will increase the federal estate tax marital deduction for that decedent, and property qualifying for a marital deduction in the first decedent's estate will usually be included in the federal taxable estate of the surviving spouse.

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