Jack and Jill Uphill, both age $64$ and married, live in Kansas. They have two grown daughters: Rachel and Rebecca. Jack and Jill each have a will leaving all assets to their spouse, and if the spouse has pre$-$deceased them, all is to be divided equally between their daughters.

Jack and Jill have the following assets:

Checking account $$ JTWROS: $$100,000$

Savings account $$ JTWROS: $$500,000$

Money market account $$ fee simple Jack: $$6$ million $($holding proceeds from the recent sale of business$)$

Residence $$ JTWROS: $$800,000$ FMV$,$ $$200,000$ adjusted basis

Auto$$fee simple Jack: $$75,000$ FMV

Auto$$fee simple Jill: $$40,000$

Household goods $$ JTWROS: $$400,000$

Jewelry $$ fee simple Jill: $$3$ million FMV$,$ adjusted basis $$1$ million

Cash value life insurance policy: Jack is the owner and insured, and Jill is the beneficiary; $$1$ million face value; $$400,000$ cash value

Cash value life insurance policy: Jack is the owner and the beneficiary; Jill is the insured; $$1$ million face value; $$400,000$ cash value

Stock portfolio $$ owned fee simple by Jack: $$8$ million FMV$,$ $$3$ million adjusted basis

Farm in South Dakota $$ owned fee simple by Jill: $$5$ million FMV$,$ $$2$ million adjusted basis

IRA $$ owned by Jack, the beneficiary is Jack$$s mother, who died last year: $$800,000$ FMV

IRA $$ owned by Jill, Rachel, and Rebecca are the beneficiaries: $$2$ million FMV

$401($k$)$ owned by Jack, beneficiaries are Rachel and Rebecca: $$4$ million FMV

$401($k$)$ owned by Jill, Jack is the beneficiary: $$3$ million FMV

The business is owned as tenants in common between Rachel and Jill: $$800,000$ FMV of business; Jill is $50\%$ owner

They estimate their final medical expenses, debts, and funeral costs will be $$100,000$ for each of them.

They have made no taxable gifts in their lifetime. Jack and Jill aren$$t overwhelmingly philanthropic but would much rather give money to qualifying charities while they are alive and$/$or after they die to avoid paying estate taxes.

Jack and Jill have four grandchildren under the age of $5($each daughter has two children$).$ Jack and Jill are interested in providing college money for the grandchildren. Jill also has a nephew with special needs whom she would like to provide without jeopardizing his federal or state benefits or health insurance.

Jack and Jill are not in favor of giving money outright to their daughters. One of their sons$-$in$-$law has addiction issues, and the other daughter and son$-$in$-$law have creditor issues. Neither of their daughters is interested in operating the farm Jill inherited from her family. Jill currently rents it to a rancher, from whom she receives income most years. However, she is not opposed to selling the farm if is recommended.

$1.$ List the assets and the amount of each asset and the total probate estate for each of them. Jack and Jill are opposed to probate and would like for you to advise them on how to avoid probate when they die. On this page, do a bulleted list of what you recommend they do to avoid probate.

$2.$ Calculate the gross estate and the consequent estate taxes that would be due for each of them $($calculate each gross estate as if the other spouse is still alive$)$ if they died in $2022.$ On the bottom of this page, do a bulleted list of your recommendations to reduce their gross estate and to meet their estate planning goals.

$3.$ Discuss estate planning recommendations you would advise. Be sure to explain why you would make each recommendation. Make sure you have sufficient liquid assets in your plan so they have the funds to pay the final expenses and any taxes that may be due.