Married couples whose combined wealth falls below $30 million will owe zero federal estate tax on transfers to the next generation starting in January 2026, after the IRS confirmed a per-person basic exclusion amount of $15,000,000 for estates of decedents dying that calendar year. That figure is up from $13,990,000 in 2025, and because federal law allows a surviving spouse to inherit a deceased partner’s unused portion of the exclusion, a couple that plans correctly can pass the full doubled amount to heirs without triggering the 40 percent federal estate tax. The catch: claiming that second exemption requires paperwork that many families skip.
How the $15 million exclusion changes estate planning for 2026
The jump from $13,990,000 to $15,000,000 reflects inflation adjustments released by the IRS in its tax year 2026 guidance, which also incorporated changes from the One, Big, Beautiful Bill. For a single decedent, the new threshold means the first $15,000,000 of an estate passes free of federal estate tax. For a married couple, the mechanism known as portability of the Deceased Spousal Unused Exclusion, or DSUE, effectively doubles that shield to $30,000,000, but only if the executor of the first spouse to die files a federal estate tax return electing portability.
That filing requirement creates a real tension. When the first spouse dies with an estate well below the filing threshold, executors often see no reason to prepare a Form 706 because no tax is owed. Yet skipping the return means the surviving spouse permanently loses access to whatever portion of the deceased spouse’s exclusion went unused. For a couple with $25 million in combined assets, failing to file could expose millions to a 40 percent tax rate at the second death. The higher the per-person exclusion climbs, the larger the potential DSUE amount at stake, and the greater the incentive to file voluntarily. Whether that incentive actually translates into more filings is an open question, because the IRS has not published data on how many estates below the filing threshold submit Form 706 solely to preserve portability.
Filing rules and the five-year safety net for portability
Federal regulations spell out the requirement plainly. Under 26 CFR 20.2010-2, the executor must elect portability of the DSUE amount on a timely filed Form 706. The IRS estate tax page explains that, beginning in 2011, estates of decedents survived by a spouse may transfer any unused exemption to the survivor, but only through this formal return. Even when no estate tax is due, the return must be complete, including a full accounting of assets and their values. The IRS emphasizes on its estate tax overview that filing thresholds and elections are driven by the gross estate and adjusted taxable gifts, not by the amount of tax ultimately owed.
Families that missed the original deadline have a backup option, though the two rules sit in some tension. The general requirement calls for a timely filed Form 706, yet Revenue Procedure 2022-32 allows certain estates to make a late portability election by filing a complete Form 706 on or before the fifth anniversary of the decedent’s date of death. To qualify, the estate must not have been otherwise required to file an estate tax return, and no return can have been filed previously for that decedent. The relief is automatic if the estate meets these conditions and includes the required statement at the top of the late-filed return referencing the revenue procedure.
This five-year window offers a significant safety net for surviving spouses and their advisors. A family that initially assumed its wealth would never approach the exclusion amount may later see rapid appreciation in a closely held business, investment portfolio, or real estate. As long as the first spouse’s death occurred within the prior five years and the estate was not otherwise required to file, the executor can still retroactively secure the DSUE amount. For high-net-worth couples whose combined assets hover near the exclusion, reviewing past deaths in the family and the timing of those events has become a standard part of estate planning.
Practical steps for couples near the threshold
The rising exclusion amount and expanded late-election relief do not eliminate the need for disciplined planning. Couples whose net worth is within striking distance of $15 million per person should ensure that wills or revocable trusts clearly identify an executor who is willing and able to handle a full estate tax return, even if no tax will be due. They should also maintain organized records of asset values, appraisals, and prior taxable gifts so that a Form 706 can be prepared efficiently when the first spouse dies.
Advisors increasingly recommend that surviving spouses consider portability as part of a broader strategy that may also include credit shelter trusts, lifetime gifting, and charitable planning. In some cases, preserving the DSUE amount provides enough cushion that more complex trust structures become optional rather than mandatory. In others, especially where state-level estate or inheritance taxes apply, a combination of portability and traditional trust planning may still be warranted. What is clear under the 2026 rules is that ignoring the portability election can turn an otherwise avoidable estate tax into a very expensive surprise for the next generation.
David M. Keller is a finance writer based in Columbus, Ohio, covering personal finance and consumer-focused economic topics. He earned his degree in journalism from Ohio University and began his career reporting on local business and economic trends for a regional media outlet. Since then, he has contributed to a variety of online publications, focusing on clear, practical coverage of topics such as cost of living, debt, and everyday financial decision-making.
