Benny and Martha Franklin are $55$ years old and have been happily married for $35$ years. They are

both in excellent health and expect they will live well into their $90$s$.$ They live in New Hampshire and

have three children and six grandchildren. They plan to retire at age $65.$ The following depicts their

family as of today:

Benny and Martha Franklin

Joe and James are both married and work in the family business. Jeff is a lawyer and is recently

divorced with custody over his daughter, Elizabeth. Benny and Martha have a great relationship

with their daughter in laws and consider them part of the family.

Benny graduated MIT and is an aerospace engineer. He started and owns three companies that

produce components for various weapons systems for the US Dept of Defense. Joe and James both

have been working for Benny in various roles for the last couple years.

Martha majored in communications at Boston College and has been a stay at home mom. She now

helps with the grandchildren regularly and volunteers with the Wounded Warrior Project.

Benny and Martha own a vacation home on Martha's Vineyard. They have a life insurance policy

that pays on the death of the second spouse $($called a seconBenny and Martha Franklin are $55$ years old and have been happily married for $35$ years. They are

both in excellent health and expect they will live well into their $90$s$.$ They live in New Hampshire and

have three children and six grandchildren. They plan to retire at age $65.$ The following depicts their

family as of today:

Benny and Martha Franklin

Benny and Martha$$s children: Joe $($age $34)$

Grandchildren $($children of$)$: Sydney $($age $10)$

Will $($age $8)$

Ivan $($age $7)$

Jeff $($age $29)$

Elizabeth $($age $2$

James $($age $32)$

Jordan $($age $7)$

Colin $($age $5)$

Joe and James are both married and work in the family business. Jeff is a lawyer and is recently

divorced with custody over his daughter, Elizabeth. Benny and Martha have a great relationship

with their daughter in laws and consider them part of the family.

Benny graduated MIT and is an aerospace engineer. He started and owns three companies that

produce components for various weapons systems for the US Dept of Defense. Joe and James both

have been working for Benny in various roles for the last couple years.

Martha majored in communications at Boston College and has been a stay at home mom. She now

helps with the grandchildren regularly and volunteers with the Wounded Warrior Project.

Benny and Martha own a vacation home on Martha$$s Vineyard. They have a life insurance policy

that pays on the death of the second spouse $($called a second to die policy$)$ with a death benefit of

$$2$m and a cash value of $$200,000.$ The policy is owned by Benny and the three children are the

beneficiaries, $1/3$ each.

They have investment real estate that includes several pieces of commercial real estate all owned

jointly between Benny and his brother in law $($his sister$$s husband$)$ which they bought together as

an investment.

They have basic wills that were written when they were first married and there are no trusts

whatsoever.

Their Balance Sheet looks as follows, with Jt representing joint ownership, H representing the asset

owned by Benny and W representing ownership by Martha:

Assets

Liabilities and Net Worth

Jt checking and savings

Jt brokerage account

H cash value insurance

H $401($k$)$ plan

Real estate owned w$/$

brother in law

Jt primary residence

H vacation home

H car

W car

Jt furniture

Jt jewelry

Total Assets

$ $2,000,000$

$ $6,000,000$

$ $200,000$

$ $3,000,000$

$$15,000,000$

$ $3,000,000$

$ $4,000,000$

$

$50,000$

$

$70,000$

$ $500,000$

$ $250,000$

$$34,070,000$

Jt credit cards

Jt mortgage

Total Liabilities

Net Worth

$ $100,000$

$ $500,000$

$ $600,000$

$$33,470,000$

Total Liabilities & Net Worth $$34,070,000$

Given what we$$ve reviewed in class, what are the implications of the Franklin$$s case regarding their

estate plan? Specifically,

$1.$ What estate documents should they have?

$2.$ Should they own a trust?

a$.$ If so$,$ why?

b$.$ If so$,$ what type of trust$($s$)?$

$3.$ What are the implications of ownership of their assets? Would you make any

recommendations of them changing how they titled $($or own$)$ any of their assets?

$4.$ What are the cost basis implications of each asset if one or the other dies? Make sure you

look at each asset and reference each asset.

$5.$ What is the total taxable estate should they both die at the same time? How did you come

up with that figure?

$6.$ What is the state estate tax implication if they die at the same time?

$7.$ What is the federal estate tax implication $($using $2024$ estate tax numbers$)$ should they both

die at the same time, assuming no changes to ownership or none of your recommendations

having been implemented?

$8.$ What would you, therefore, suggest they do to minimize estate taxes and probate costs?

$9.$ Are there any other recommendations you would have?