Does the marital deduction apply if my spouse is not a US citizen?

What the Law Says

Federal estate tax law allows a marital deduction for property passing from a deceased spouse to a surviving spouse — but only if the surviving spouse is a U.S. citizen. A special exception exists for non-citizen spouses using a Qualified Domestic Trust (QDOT).

Under Internal Revenue Code § 2056, the marital deduction permits the full value of assets transferred to a surviving spouse to be excluded from the decedent’s taxable estate — eliminating or deferring estate tax. However, this benefit is limited to transfers to spouses who are U.S. citizens at the time of the decedent’s death.

Section 2056(d)(1) explicitly states: 'No deduction shall be allowed under this section with respect to any property which passes to the surviving spouse if such surviving spouse is not a citizen of the United States.'

The law provides one key exception: if the property passes to a Qualified Domestic Trust (QDOT), the marital deduction may apply. A QDOT must meet strict requirements — including having at least one U.S. trustee, limiting distributions of principal, and ensuring estate tax is paid on amounts distributed (except for hardship).

For QDOTs holding more than $1 million (adjusted for inflation), at least one trustee must be a U.S. bank or trust company. The executor must also file Form 706-QDT and elect QDOT status within 30 days after the estate tax return due date (generally 9 months after death, with extensions).

Statutory Text

No deduction shall be allowed under this section with respect to any property which passes to the surviving spouse if such surviving spouse is not a citizen of the United States.

— 26 U.S.C. § 2056(d)(1) — Marital deduction for estate tax

What to Do

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