Thursday, November 14, 2013
Neglecting traditional estate planning techniques because of heavy reliance on portability might have some negative consequences. Couples that are planning to use portability should check with an advisor to be sure that they understand the impact of their decision. Below are a few of the adverse consequences:
- Portability could be eliminated or changed
- Assets passed on to the surviving spouse can use up more of the tax exemption in the surviving spouse’s estate because of the appreciation.
- If a surviving spouse remarry's and the second spouse predeceases, the surviving spouse will lose the unused exemption amount.
See Conan Yuzna, Over-Reliance on Portability May Have Negative Consequences, Wealth Strategies, Nov. 4, 2013.
Special thanks to Jim Hillhouse (Professional Legal Marketing (PLM, Inc.)) for bringing this article to my attention.