Graham was the owner and the insured of a $3 million life insurance policy and his wife Karen was the beneficiary. At Grahams death, Karen disclaimed all of the proceeds that subsequently passed from his estate to a testamentary bypass trust. Which of the following statements is correct?

1. The$3million death benefit is included in Graham's estateand the proceeds qualify for a marital deduction.

   The$3million death benefit is not included in Graham's estate because the proceeds pass to a bypass trust.

   The$3million death benefit is not included in Graham's estateand the proceeds do not qualify for a marital deduction.

   The$3million death benefitis notincluded in Graham's grossestatebBecause Karen has forfeited all rights to the proceeds.