Before: Herbert Y.c. Choy, Harry Pregerson, and Robert Boochever, Circuit Judges.
The opinion of the court was delivered by: Choy, Circuit Judge:
Appeal from the United States District Court for the Northern District of California Susan Y. Illston, District Judge, Presiding
Argued and Submitted May 13, 1998
Argued and Submitted May 13, 1998--San Francisco, California
Plaintiffs-Appellants, members of the McKeon Family ("Estate"), appeal in this tax action the grant of summary judgment in favor of Defendant-Appellee United States of America ("Government"). The district court found that the Estate had overstated its marital deduction under I.R.C. S 2056.
Factual and Procedural Background
Marguerite B. McKeon ("decedent") died on April 27, 1994 while a resident of the State of California. She was survived by her husband Edward T. McKeon, Jr. They had two sons, Ross T. McKeon and Scott M. McKeon, both living at the time of the decedent's death.
Prior to her death, the decedent executed two trusts and a will dated February 4, 1992.
I. The McKeon Trust ("Trust A")
Trust A was funded with the community property of the decedent and her husband, although the trust instrument permitted funding from separate property as well.
Trust A provided that upon the death of the first spouse, the trust was to be divided into 2 parts--a "Survivor's ...