
The fiscal cliff bill signed shortly after New Year's provided a permanent extension of the portability of the unused portion of a spouse’s lifetime gift and estate exclusion amount ($5.12 million in 2012 and indexed for inflation thereafter). This provision gives couples an additional way to preserve both spouses’ full exclusions without the need for traditional credit shelter and bypass trusts. In other words, a couple can combine their $5 million (indexed) exclusion when elected after the first spouse's death. This was already the case for 2011 and 2012 but was extended on a permanent basis.