At the time of her death, Megan was involved in the following
? Owned an insurance policy on the life of her father with a replacement cost of $250,000 and maturity value of $800,000 . The designated beneficiary of the policy is Megan's estate.
? Was an equal tenant in common with her brother in a tract of land worth $800,000 . The land was inherited from their grandmother 10 years ago when it had a value of $200,000.
? Was a joint tenant with her two sisters in stock worth $1,500,000 . The stock was inherited from their grandmother 10 years ago when it had a value of $500,000.
As to these transactions, Megan's gross estate must include:
a. $250,000.
b. $1,150,000.
c. $1,400,000.
d. $2,150,000.
e. None of the above.
b
RATIONALE: $250,000 + $400,000 + $500,000 = $1,150,000 . The value of an unmatured life insurance policy is included in the owner's gross estate. The decedent's ownership interest in a tenancy in common is included in the gross estate. As to Megan's joint tenancy interest, she is considered to have contributed one-third as the property came from another.
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