Your clients, Max and Marge Power, have three children (Bart, Lisa, and Maggie) and have been married for 20 years. They reside (and have resided in for the entirety of their marriage) in Wisconsin. Max has a relatively simple will that leaves his estate in equal portions to his three children. In the event that a beneficiary predeceases Max, assets are to be distributed per capita.

The following assets were part of their estate and were titled as detailed below:

1. Primary Residence in Wisconsin ($450,000) purchased 2 years after they married for $250,000.
2. Vacation Home in Oregon ($300,000) owned fee simple by Max purchased 5 years before they married.
3. Condominium in Madison ($250,000) owned fee simple by Marge purchased 3 years before they married.
4. A 2005 BMW valued at $5,000 that they purchased after they married.
5. A fishing boat valued at $30,000 owned by Max and Bart JTWROS. Max purchased the boat with his own money prior to marrying Marge.
6. Home furnishings (Valued at $150,000) were all purchased after the marriage of Max and Marge
7. A Money Market account ($400,000) opened by Max prior to his marriage to Marge (POD to Lisa). The only funds invested in the account after the marriage came 5 years ago when Max received an inheritance from his late father.
8. Roth IRA (1,500,000) owned by Max with Marge as beneficiary. The account was started after their marriage. No contingent beneficiary is named.
9. Life Insurance policy on Max that Max bought 30 years ago and has paid premiums on using funds from the Money Market Account (Fair Market Value: $200,000; Death Benefit: $1,000,000). Beneficiary on the account is Maggie.

1. Explain the income tax implications of Maxs death with regard to the primary residence:

2. Say that Lisa predeceased Max and Lisa had three children. Under the current will and given the numbers provided, what would be the ownership stake in the home for each of the three grandchildren?

3. Assume that the Boat was held Tenancy in Common by Max and Bart, with Bart having a 50% ownership stake. Answer the following sub-questions:

1. Will this change alter the FMV of the boat in Maxs estate?
2. Will the boat be included in the probate estate and if so, in what amount?
3. Are there any gift tax implications for the TIC designation being applied to the boat?

4. What changes might you recommend regarding assets involved in probate or facilitating ease of property transfers in the case of Maxs estate?