The unlimited marital deduction is commonly used to defer all federal estate taxes until the surviving spouse's death. However, the estate tax is a progressive tax and the tax on the combined estates of a husband and wife taxed as one estate is often greater than if the estates were taxed separately. Thus, an estate planner must always consider whether it is tax wise to equalize the estates and pay estate taxes in both estates or whether to defer estate taxes until the second death. If the decedent's will is not written to take advantage of the unlimited marital deduction through a bequest to a surviving spouse, it might be possible to achieve this result by having the surviving spouse assert dower or curtesy rights against the will. Most states, other than community property states, give a surviving spouse the right to elect to take either a bequest under the will or a specified percentage of the probate estate.
State law varies widely, both as to the amount available and as to the procedure.
The advantage of electing against the will and claiming the dower or curtesy interest is that the interest may qualify for the unlimited estate tax marital deduction, reduce the taxable estate, and defer estate taxes. State laws must be complied with and care exercised so that the claiming of the dower or curtesy rights results in the availability of the estate tax marital deduction. Property that passes in full ownership as an outright bequest to the surviving spouse automatically qualifies for the estate tax marital deduction. No election needs to be made. Congress felt that a full ownership bequest to the surviving spouse in order to qualify for the marital deduction was too harsh a price to pay since it gave the surviving spouse full control over the property.