Cases: Estate of Burghardt v. Commissioner, 80 T.C. 705 (1983); Estate of Gawne v. Commissioner, 80 T.C. 478 (1983); Estate of Arnaud v. Commissioner, 90 T.C. 649 (1988)
Forms: Form 706; Form 706-QDT
Final rules 2
(a) General rule A credit of the applicable credit amount shall be allowed to the estate of every decedent against the tax imposed by section 2001.
Amended 1981, 1997
- 1997 Pub. L. 105-34 Pub. L. 105–34, § 501(a)(1)(A), substituted “the applicable credit amount” for “$192,800”.
- 1981 Pub. L. 97-34 Pub. L. 97–34, § 401(a)(1), substituted “$192,800” for “$47,000”.
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(b) Adjustment to credit for certain gifts made before 1977 The amount of the credit allowable under subsection (a) shall be reduced by an amount equal to 20 percent of the aggregate amount allowed as a specific exemption under section 2521 (as in effect before its repeal by the Tax Reform Act of 1976) with respect to gifts made by the decedent after September 8, 1976.
Amended 1981, 1990
- 1990 Pub. L. 101-508 Pub. L. 101–508 redesignated subsecs. (c) and (d) as (b) and (c), respectively, and struck out former subsec. (b) which provided for a phase-in of the unified credit against estate tax.
- 1981 Pub. L. 97-34 Pub. L. 97–34, § 401(a)(2)(A), struck out “$47,000” before “credit” from heading and in text substituted in subsec. (a) substitutions for “$192,800” amounts of “$62,800”, “$79,300”, “$96,300”, “$121,800”, and “$155,800” in the case of decedents dying in 1982, 1983, 1984, 1985, and 1986, respectively, for subsec. (a) substitutions for “$47,000” amounts of “$30,000”, “$34,000”, “$38,000”, and “$42,500” in the case of decedents dying in 1977, 1978, 1979, and 1980, respectively.
(c) Applicable credit amount
Amended 1990, 1997, 2001, 2010
- 2010 Pub. L. 111-312 Pub. L. 111–312, § 302(a)(1), amended subsec. (c) generally, substituting pars. (1) and (2) for text which provided that the applicable credit amount for purposes of this section was the amount of the tentative tax which would be determined under the rate schedule set forth in section 2001(c) if the amount with respect to which such tentative tax was to be computed were the applicable exclusion amount determined in accordance with the table, covering years 2002 to 2009, included in that text.
- 2001 Pub. L. 107-16 Pub. L. 107–16, in table, substituted provision that in the case of estates of decedents dying during the years 2002 and 2003, the years 2004 and 2005, the years 2006, 2007, and 2008, and the year 2009, the applicable exclusion amount is $1,000,000, $1,500,000, $2,000,000, and $3,500,000, respectively, for provision that in the case of decedents dying, and gifts made, during the year 1998, the year 1999, the years 2000 and 2001, the years 2002 and 2003, the year 2004, the year 2005, and the year 2006 or thereafter, the applicable exclusion amount is $625,000, $650,000, $675,000, $700,000, $850,000, $950,000, and $1,000,000, respectively.
- 1997 Pub. L. 105-34 Pub. L. 105–34, § 501(a)(1)(B), added subsec. (c) and redesignated former subsec. (c) as (d).
- 1990 Pub. L. 101-508 Pub. L. 101–508 redesignated subsecs. (c) and (d) as (b) and (c), respectively, and struck out former subsec. (b) which provided for a phase-in of the unified credit against estate tax.
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(1) In general For purposes of this section, the applicable credit amount is the amount of the tentative tax which would be determined under section 2001(c) if the amount with respect to which such tentative tax is to be computed were equal to the applicable exclusion amount.
(2) Applicable exclusion amount For purposes of this subsection, the applicable exclusion amount is the sum of—
Amended 2010
- 2010 Pub. L. 111-312 Pub. L. 111–312, § 303(a), added pars. (2) to (6) and struck out former par. (2). Prior to amendment, text of par. (2) read as follows:
- 2010 “(A) In general.—For purposes of this subsection, the applicable exclusion amount is $5,000,000.
- 2010 “(B) Inflation adjustment.—In the case of any decedent dying in a calendar year after 2011, the dollar amount in subparagraph (A) shall be increased by an amount equal to—
“(i) such dollar amount, multiplied by
“(ii) the cost-of-living adjustment determined under section 1(f)(3) for such calendar year by substituting ‘calendar year 2010’ for ‘calendar year 1992’ in subparagraph (B) thereof.
If any amount as adjusted under the preceding sentence is not a multiple of $10,000, such amount shall be rounded to the nearest multiple of $10,000.”
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(A) the basic exclusion amount, and
(B) in the case of a surviving spouse, the deceased spousal unused exclusion amount.
(3) Basic exclusion amount
Amended 2010, 2017, 2025
- 2025 Pub. L. 119-21 Pub. L. 119–21, § 70106(a)(3), struck out subpar. (C). Text read as follows: “In the case of estates of decedents dying or gifts made after December 31, 2017, and before January 1, 2026, subparagraph (A) shall be applied by substituting ‘$10,000,000’ for ‘$5,000,000’.”
- 2017 Pub. L. 115-97 Pub. L. 115–97, § 11061(a), added subpar. (C).
- 2010 Pub. L. 111-312 Pub. L. 111–312, § 303(a), added pars. (2) to (6) and struck out former par. (2). Prior to amendment, text of par. (2) read as follows:
- 2010 “(A) In general.—For purposes of this subsection, the applicable exclusion amount is $5,000,000.
- 2010 “(B) Inflation adjustment.—In the case of any decedent dying in a calendar year after 2011, the dollar amount in subparagraph (A) shall be increased by an amount equal to—
“(i) such dollar amount, multiplied by
“(ii) the cost-of-living adjustment determined under section 1(f)(3) for such calendar year by substituting ‘calendar year 2010’ for ‘calendar year 1992’ in subparagraph (B) thereof.
If any amount as adjusted under the preceding sentence is not a multiple of $10,000, such amount shall be rounded to the nearest multiple of $10,000.”
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(A) In general For purposes of this subsection, the basic exclusion amount is $15,000,000.
Amended 2025
- 2025 Pub. L. 119-21 Pub. L. 119–21, § 70106(a)(1), substituted “$15,000,000” for “$5,000,000”.
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(B) Inflation adjustment In the case of any decedent dying in a calendar year after 2026, the dollar amount in subparagraph (A) shall be increased by an amount equal to—
Amended 2025
- 2025 Pub. L. 119-21 Pub. L. 119–21, § 70106(a)(2)(A), substituted “2026” for “2011” in introductory provisions.
(i) such dollar amount, multiplied by
(ii) the cost-of-living adjustment determined under section 1(f)(3) for such calendar year by substituting “calendar year 2025” for “calendar year 2016” in subparagraph (A)(ii) thereof.
Amended 2017, 2025
- 2025 Pub. L. 119-21 Pub. L. 119–21, § 70106(a)(2)(B), substituted “calendar year 2025” for “calendar year 2010”.
- 2017 Pub. L. 115-97 Pub. L. 115–97, § 11002(d)(1)(CC), substituted “for ‘calendar year 2016’ in subparagraph (A)(ii)” for “for ‘calendar year 1992’ in subparagraph (B)”.
If any amount as adjusted under the preceding sentence is not a multiple of $10,000, such amount shall be rounded to the nearest multiple of $10,000.
(4) Deceased spousal unused exclusion amount For purposes of this subsection, with respect to a surviving spouse of a deceased spouse dying after December 31, 2010, the term “deceased spousal unused exclusion amount” means the lesser of—
Amended 2010
- 2010 Pub. L. 111-312 Pub. L. 111–312, § 303(a), added pars. (2) to (6) and struck out former par. (2). Prior to amendment, text of par. (2) read as follows:
- 2010 “(A) In general.—For purposes of this subsection, the applicable exclusion amount is $5,000,000.
- 2010 “(B) Inflation adjustment.—In the case of any decedent dying in a calendar year after 2011, the dollar amount in subparagraph (A) shall be increased by an amount equal to—
“(i) such dollar amount, multiplied by
“(ii) the cost-of-living adjustment determined under section 1(f)(3) for such calendar year by substituting ‘calendar year 2010’ for ‘calendar year 1992’ in subparagraph (B) thereof.
If any amount as adjusted under the preceding sentence is not a multiple of $10,000, such amount shall be rounded to the nearest multiple of $10,000.”
(A) the basic exclusion amount, or
(B) the excess of—
(i) the applicable exclusion amount of the last such deceased spouse of such surviving spouse, over
Amended 2013
- 2013 Pub. L. 112-240 Pub. L. 112–240 substituted “applicable exclusion amount” for “basic exclusion amount”.
(ii) the amount with respect to which the tentative tax is determined under section 2001(b)(1) on the estate of such deceased spouse.
(5) Special rules
Amended 2010
- 2010 Pub. L. 111-312 Pub. L. 111–312, § 303(a), added pars. (2) to (6) and struck out former par. (2). Prior to amendment, text of par. (2) read as follows:
- 2010 “(A) In general.—For purposes of this subsection, the applicable exclusion amount is $5,000,000.
- 2010 “(B) Inflation adjustment.—In the case of any decedent dying in a calendar year after 2011, the dollar amount in subparagraph (A) shall be increased by an amount equal to—
“(i) such dollar amount, multiplied by
“(ii) the cost-of-living adjustment determined under section 1(f)(3) for such calendar year by substituting ‘calendar year 2010’ for ‘calendar year 1992’ in subparagraph (B) thereof.
If any amount as adjusted under the preceding sentence is not a multiple of $10,000, such amount shall be rounded to the nearest multiple of $10,000.”
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(A) Election required A deceased spousal unused exclusion amount may not be taken into account by a surviving spouse under paragraph (2) unless the executor of the estate of the deceased spouse files an estate tax return on which such amount is computed and makes an election on such return that such amount may be so taken into account. Such election, once made, shall be irrevocable. No election may be made under this subparagraph if such return is filed after the time prescribed by law (including extensions) for filing such return.
(B) Examination of prior returns after expiration of period of limitations with respect to deceased spousal unused exclusion amount Notwithstanding any period of limitation in section 6501, after the time has expired under section 6501 within which a tax may be assessed under chapter 11 or 12 with respect to a deceased spousal unused exclusion amount, the Secretary may examine a return of the deceased spouse to make determinations with respect to such amount for purposes of carrying out this subsection.
(6) Regulations The Secretary shall prescribe such regulations as may be necessary or appropriate to carry out this subsection.
Amended 2010
- 2010 Pub. L. 111-312 Pub. L. 111–312, § 303(a), added pars. (2) to (6) and struck out former par. (2). Prior to amendment, text of par. (2) read as follows:
- 2010 “(A) In general.—For purposes of this subsection, the applicable exclusion amount is $5,000,000.
- 2010 “(B) Inflation adjustment.—In the case of any decedent dying in a calendar year after 2011, the dollar amount in subparagraph (A) shall be increased by an amount equal to—
“(i) such dollar amount, multiplied by
“(ii) the cost-of-living adjustment determined under section 1(f)(3) for such calendar year by substituting ‘calendar year 2010’ for ‘calendar year 1992’ in subparagraph (B) thereof.
If any amount as adjusted under the preceding sentence is not a multiple of $10,000, such amount shall be rounded to the nearest multiple of $10,000.”
(d) Limitation based on amount of tax The amount of the credit allowed by subsection (a) shall not exceed the amount of the tax imposed by section 2001.
Amended 1990, 1997
- 1997 Pub. L. 105-34 Pub. L. 105–34, § 501(a)(1)(B), added subsec. (c) and redesignated former subsec. (c) as (d).
- 1990 Pub. L. 101-508 Pub. L. 101–508 redesignated subsecs. (c) and (d) as (b) and (c), respectively, and struck out former subsec. (b) which provided for a phase-in of the unified credit against estate tax.