James died on 1/1/20 with the following assets and liabilities:

Cash	$18,000,000
Real Estate	$5,300,000
Installment Note	$2,000,000
Mortgage	($500,000)

The installment note has a zero basis. The mortgage is secured by the real estate, and the $500,000 liability includes $5,000 of interest accrued to, but unpaid at date of death. All assets pass as part of James' probate estate.

in his will, James left to his wife Mary a preresiduary pecuniary formula gift.

Probate administration was completed on 12/1/20. Upon closing the estate, the executor paid executor, attorney and accounting fees of $100,000 and interest on the mortgage of $20,000 (which includes the portion which accrued prior to James' death). All expenses subject to 642(g) have been deducted for income tax purposes.

The executor distributed to Mar the encumbered real estate (which had not changed in value) and sufficient cash to satisfy the pecuniary gift. The installment note and remaining cash were distributed to James' daughter Becky.

1. Compute the amounts passing to Mary and Becky respectively, and determine the available deductions under Sections 691(b) and (c), if any.
2. In a., assume instead that Mary was bequeathed an amount equal to 50% of the gross estate. (Look at Reg. Sec. 1.691(c)-1(a)(2).)