What is the gradual increase in exclusion amounts for estate tax transfers between spouses?

The correct choice reflects the significant changes in the exclusion amounts for estate tax transfers between spouses allowed under current tax laws. Traditionally, the estate tax exclusion amount has been adjusted upwards based on legislative changes and inflation.

As of the recent updates, the exclusion amount for estate tax transfers between spouses has been raised significantly to accommodate estate planning needs. The passage of the Tax Cuts and Jobs Act (TCJA) in late 2017 notably increased the threshold to $11.18 million per individual, which translates to an exclusion amount of $22.36 million for married couples when considering both spouses' exclusions.

The gradual increase from $250,000 to $3,500,000 noted in the option appropriately captures this progression, highlighting the trend toward more favorable treatment of estate transfers between spouses. This change incentivizes wealth retention within the family and supports long-term financial planning strategies, benefiting many couples in estate management.

In contrast, the other options do not accurately reflect this significant adjustment and ceiling in exclusion amounts; they either fall short of the current trends or misalign with the legal structure governing estate taxation.