Facts$/$Background Information:

Husband: George Stevens $$ Age $60$

Wife: Mary Stevens $$ Age $59$

Children: Susan $$ Age $34,$ George Jr$.-$Age $32,$ William Age $29$

George$$s child from previous marriage $$ Betty $$ Age $40$

As you remember, George and Mary were both school teachers in Maine. They had a plan is to retire when Mary turned $60.$ Unfortunately, George passed away suddenly on $12/31/2023.$

At the time of his death, they owned several pieces of real estate including:

$1.$ Their principal residence in Cumberland Foreside valued at $$1\mathrm{.}5$ million, basis $$300$k

a$.$ Property was acquired during George$$s first marriage and was signed over to him at the time of the divorce. George recently changed the title over to include his wife Mary as Joint Tenants w$/$rights of survivorship.

$2.$ Second Residence$/$Vacation home St$.$ George, ME Valued at $$2$ million, basis $$500$k $($Mary$$s basis $$250$k$)$

a$.$ Mary owns $50\%$ with her brother Larry owning the other $50\%$ as tenants in common. Property was inherited by Mary and Larry after her mother passed away a few years ago.

$3.$ Vacation$/$future retirement home in Wallagrass, ME Valued at $$300$k$,$ basis $$25$k$.$

a$.$ Owned as joint tenants with rights of survivorship. Property was purchased several years ago as a retreat$/$vacation home. The plan was to move there and retire when Mary turned $60.$

$4.$ Vacation$/$Rental condo in Newry, ME$.$ Valued at $$600$k$,$ basis $$150$k$.$

a$.$ George owned as tenants in common with Mary, Susan, George Jr$.,$ William and Betty. Property was purchased several years ago as a vacation home and has been rented out periodically when not in use.

They also have the following bank accounts:

$5.$ Bank Account at Bank of America with $$75,000$ in it$.$ Account is a joint checking account.

$6.$ Bank Account at Bangor Savings with $$50,000$ in it$.$ Account is in George$$s name only

$7.$ Bank Account at Norway Savings with $$30,000$ in it$.$ Account is in Mary$$s name only.

Other Assets:

George $$ Retirement Plan $($not including MSRS$)$ Section $403($b$)$ Value $$1,250,000.$ The beneficiary is Mary and contingent beneficiaries are the $3$ kids equally.

George $$ Maine State Retirement Pension $$ Valued at $$1\mathrm{.}2$ million. Mary is the beneficiary. Only allow for spouses as beneficiary.

Mary $$ Retirement Plan $($not Including MSRS$)$ Section $403($b$)$ Value $$725,000.$ The beneficiary is George and contingent beneficiaries are the $3$ kids equally.

Mary $$ Maine State Retirement Pension. $$ Valued at $$500$k$.$ George is the beneficiary. Only allow spouses as beneficiary.

George owns a life insurance policy on his life. The policy is term life and the value is $$1,000,000.$ The beneficiaries are his $4$ kids equally.

Mary owns a life insurance policy on her life. The policy is term life and the value is $$1,000,000.$ The beneficiaries are her $3$ kids equally.

All vehicles were owned joint tenants WROS with Mary.

Funeral Costs $-$ $$15,000$

Administrative Costs $-$ $$10,000$

George had made prior taxable gifts of $2009-$ $$100$k$,2010-$ $$100$k$,2021-$ $$500$k$.$

Assume, estate tax exemption portability will be claimed on George$$s $706.$

George$$s will hadn$$t been updated and left everything to Mary, his spouse.

Assignment #$4$:

$1.$ Calculate George$$s probate estate, gross estate, taxable estate.

$2.$ What is Mary$$s basis in the assets after George dies?

$3.$ What do you recommend for Mary now that George is gone? Mary$$s will also has not been updated and needs to be because it leaves all her assets to George.