Illinois Couples Face Estate Tax Gap Without Portability

CHICAGO, IL, September 08, 2026 /CourierPR/ -- Kravets Law Group, a Chicago-based legal firm, has issued a warning to Illinois married couples about a significant gap in state estate planning that could result in substantial financial burdens. The firm highlights that Illinois does not offer portability of the estate tax exemption between spouses, a feature that is widely available at the federal level.

Under federal law, the surviving spouse can inherit and use the unused portion of their deceased spouse's estate tax exemption. This means that a couple with a combined federal exemption of $30 million in 2026 can effectively shield the full amount if proper planning is in place. However, Illinois does not provide this option, leaving the first spouse's $4 million exemption unused if the surviving spouse inherits the full estate.

Daniel Kravets, founding attorney at Kravets Law Group, explains that this discrepancy can be financially devastating for couples in Illinois. "When a spouse passes away, the first $4 million of their estate is exempt from Illinois estate tax," Kravets said. "But if the remaining assets are transferred outright to the surviving spouse, that initial $4 million exemption is lost. This can result in a significant tax bill when the surviving spouse eventually passes away."

To address this issue, Kravets Law Group recommends a credit shelter trust, often referred to as an AB trust or bypass trust. When the first spouse dies, a portion of their assets (up to the $4 million Illinois exemption) funds a trust for the benefit of the surviving spouse. These trust assets are not considered part of the surviving spouse's taxable estate, effectively doubling the available exemption.

Kravets Law Group notes that credit shelter trusts offer more than just tax savings. They can protect assets from creditors, preserve wealth for children from a prior marriage, and prevent assets from being redirected if the surviving spouse remarries. These non-tax benefits are especially important for families with complex blended dynamics.

"The planning has to happen while both spouses are alive and able to sign documents," Kravets emphasized. "Once the first spouse passes away, the available options start to narrow, making it crucial for couples to consider this before it's too late."

Couples seeking to understand and plan their estates can request a complimentary consultation from Kravets Law Group. The firm serves clients in Illinois, Pennsylvania, and New Jersey, specializing in real estate and property law, estate planning, and business and corporate law.

For married couples in Illinois, the absence of portability in estate tax exemption planning can lead to significant financial consequences. Proper planning, such as establishing a credit shelter trust, can help ensure that both spouses' exemptions are fully utilized, shielding a greater portion of their combined assets from estate taxes.