197 / Can operation of the Uniform Simultaneous Death Act result in loss of the marital deduction?
Yes.
If the insured and spouse-beneficiary die under circumstances that make it impossible to determine the order of death (usually when both are killed in the same accident), the Uniform Simultaneous Death Act creates a presumption that the beneficiary died first. Because it is presumed that the spouse-beneficiary did not survive, the act would result in loss of the marital deduction. It is possible to reverse the statutory presumption, however, by inserting a so-called “reverse simultaneous death clause” in the policy. This clause provides that, if the order of death cannot be determined, it will be presumed that the insured died first. This would save the marital deduction.1 It cannot save the marital deduction, however, if there is evidence that the beneficiary actually died first.
1. Treas. Reg. § 20.2056(c)-2(e).