Chad and Crystal found true love for over 25 years after ending prior challenging marriages and have since lived in a common law state.  Chad has one son, Kyle, from his prior marriage and together Chad and Crystal have two children Summer and Ashton and one granddaughter, Phyllis. Chad died in 2023 at the age of 75 from COVID-19.  At the time of his death he and/or Crystal owned the following property: 

Property	Ownership	FMV DoD
Primary Residence	JTWROS	$6,000,000
Vacation home	Chad	5,000,000
Disney timeshare	Chad (T in C w/Kyle)	200,000
Boat	JTWROS	150,000
Auto 1	Chad	80,000
Auto 2	JTWROS	60,000
Gun Collection	Chad	300,000
Personal Property	½ each	400,000
Cash in checking and savings	JTWROS	120,000
Life insurance #1 on Crystal's life	Chad	3,000,000DB/450,000CSV
Life insurance #2 on Chad's life	ILIT	10,000,000DB/900,000CSV
Life insurance #3 on Chad's life	Chad	2,000,000DB/150,000CSV
Investment portfolio	Chad	3,000,000
Antique collection	Crystal	80,000
XYZ Construction Business	Chad	5,000,000
Crystal's Roth IRA	Crystal	1,000,000
Chad's IRA	Chad	3,500,000

The beneficiary of the insurance policy (#1) on Crystal's life is Chad. The beneficiary of the insurance policy (#2) owned by the ILIT on Chad's life is Crystal she is also the trustee. Policy (#3) has Kyle, Summer, and Ashton as equal beneficiaries. All retirement accounts are left to their spouses. Chad's unreimbursed medical expenses came to $150,000, estate administration expenses came to $80,000, funeral expenses were $35,000, and the vacation home owned by Chad had an outstanding mortgage of $2,000,000. There were no other outstanding debts. 

Chad had previously used his gift tax credit to shelter a $2,500,000 gift to an irrevocable trust set up to provide for Kyle. He made no other taxable gifts during his lifetime. The ILIT was established 30 years ago and only annual exclusions have been used to transfer funds to cover the insurance premiums. Chad's will leaves all of his assets to his wife except the business to Kyle and $10,000 to the First Church of Colorado. The will directs the executor to establish a QTIP trust for Crystal with the funds from the investment portfolio naming the children as remainder beneficiaries.

Part 1: Assume all debts, expenses, and charitable bequests are paid out of Crystal's share. 

Part 2: Now assume that the children were listed as beneficiaries of Chad's IRA, Chad's will left his vacation home to his children and his will directs all expenses and charitable bequests to be paid out of the children's share of the estate?

 Part 1: Gross Estate

 Part 1: Marital Deduction (net)

Part 1: Taxable Estate

 Part 1: Federal Estate Tax Liability

Part 1: Unused AEA available for Portability

Part 2: Gross Estate

Part 2: Marital Deduction (net)

 Part 2: Taxable Estate

 Part 2: Federal Estate Tax Liability

Part 2: Unused AEA Available for Portability