SECTION 5. IMPACT OF RELIEF ON

SURVIVING SPOUSE

.01 Application of DSUE Amount . If the decedent’s estate is granted relief under this revenue procedure so that the estate tax return is considered to have been timely filed for purposes of electing portability, the DSUE amount of that decedent is available to the decedent’s surviving spouse or the estate of the surviving spouse for application to the surviving spouse’s transfers made on or after the decedent’s date of death in accordance with the rules prescribed under § 20.2010-3 of the Estate Tax Regulations and § 25.2505-2 of the Gift Tax Regulations. However, if the increase in the surviving spouse’s applicable exclusion amount attributable to the addition of the decedent’s DSUE amount as of the decedent’s date of death results in an overpayment of gift or estate tax by the surviving spouse or his or her estate, no claim for credit or refund may be made if the period of limitations under § 6511(a) of the Code for filing a claim for credit or refund of an overpayment of tax with respect to such transfer has expired. That is, an extension of time to elect portability granted under this revenue procedure does not extend the period during which the surviving spouse or the surviving

spouse’s estate may make a claim for credit or refund under § 6511(a).

.02 Protective Claim for Credit or Refund of Tax in Anticipation of Relief under this Revenue Procedure . Because a surviving spouse has no DSUE amount from a deceased spouse to apply to such surviving spouse’s transfers until the portability election has been made by the deceased spouse’s executor (see §§ 20.2010-3(a)(2) and 25.2505-2(a)(2)), a claim for credit or refund of tax filed within the time prescribed in § 6511(a) by the surviving spouse or the estate of the surviving spouse in anticipation of a Form 706 being filed to elect portability pursuant to this revenue procedure, and otherwise meeting applicable legal requirements, will be considered a protective claim for credit or refund of tax.

.03 Examples . (1) Example 1 . (a) Predeceasing Spouse (S1) dies on January 1, 2018, survived by Surviving Spouse (S2). The assets includible in S1’s gross estate consist of cash on deposit in bank accounts held jointly with S2 with rights of survivorship in the amount of $4,500,000. S1 made no taxable gifts during life. S1’s executor is not required to file an estate tax return under § 6018(a) and does not file such a return.

(b) S2 dies on January 29, 2021. S2’s taxable estate is $17,000,000 and S2 made no taxable gifts during life. S2’s executor files a Form 706 on behalf of S2’s estate on October 29, 2021, claiming an applicable exclusion amount of $11,700,000. S2’s executor includes payment of the estate tax with the Form 706.

(c) Pursuant to this revenue procedure, S1’s executor files a complete and properly prepared Form 706 on behalf of S1’s estate on December 1, 2022, reporting a DSUE amount of $11,180,000. The executor includes at the top of the Form 706 the statement required by section 4.01(2) of this revenue procedure. The filing of the return satisfies the requirements for a grant of relief under this revenue procedure and S1’s estate is deemed to have made a valid portability election. The IRS accepts the return of S1’s estate with no changes.

(d) To recover the estate tax paid, S2’s executor must file a claim for credit or refund of tax by October 29, 2024 (the end of the period of limitations prescribed in § 6511(a)), even though a Form 706 to elect portability was not filed on behalf of S1’s estate at the time S2’s estate filed its Form 706. Such a claim filed on Form 843, Claim for Refund and Request for Abatement, in anticipation of the filing of the Form 706 by S1’s executor will be considered a protective claim for credit or refund of tax. Accordingly, as long as the Form 843 is filed on or before October 29, 2024, the IRS can consider and process that claim for credit or refund of tax once S1’s estate is deemed to have made a valid portability election and S2’s estate notifies the IRS that the claim for credit or refund is ready for consideration.

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(2) Example 2 . (a) The facts relating to S1 and S1’s estate are the same as in Example 1 . S2 makes a gift to Child of $13,000,000 on December 1, 2020. S2 has made no prior taxable gifts. On April 15, 2021, S2’s executor files a Form 709, United States Gift (and Gen- eration-Skipping Transfer) Tax Return, claiming an applicable exclusion amount of $11,580,000. S2’s executor tenders payment of the gift tax with the Form 709.

(b) To recover the gift tax paid, S2’s executor must file a claim for credit or refund of tax (protective or otherwise) within the time prescribed in § 6511(a) for filing a claim for credit or refund; in this case, April 15, 2024.

(3) Example 3 . (a) The facts are the same as in Example 2 except that S2’s Form 709 claims an applicable exclusion amount of $22,760,000, including a DSUE amount of $11,180,000 from S1’s estate. As a result, the Form 709 reports no tax due and S2’s executor tenders no gift tax.

(b) Although the portability election, once made, makes S1’s DSUE amount available to S2 retroactively to S1’s date of death, that DSUE amount is not available until the election is made. Because S2’s executor files the Form 709 before S1’s estate makes the portability election, the claimed application of the DSUE amount will be denied and gift tax on the transfer will be assessed. S2’s executor pays the gift tax assessed. To recover that gift tax once

the portability election has been made by S1’s estate, S2’s executor must file a claim for credit or refund of tax (protective or otherwise) within the time prescribed in § 6511(a) for filing a claim for credit or refund.