Three years ago my grandmother paid for an addition on my cousins house? Is the addition part my grandmothers estate?

Unless a legal document was drawn up outlining the property, value and intent -- then the addition and any added value is the property of the property owner -- assuming it is your cousing. Sorry; it goes to your cousin and is excluded from your grandmother's estate.

If your grandmother had paid $5,000 a month to live in assisted living, you wouldn't consider that part of the estate would you? Unless your grandmother had your cousin sign papers saying it was a loan than it belongs to your cousin. It would not fall under the "gift" category because I assume your cousin was caring for your grandmother. From the info. you have provided I would look at it as an exchange for services as well as her own living accommodation.

Wouldn't the payment of the addition be considered a gift to the cousin? non- taxable gifts are limited to $12,000 per year. So a $100,000 addition over three years gives $36,000 as a non-taxable gift, and the rest $67,000 is a taxable gift? Right?

Capt you are spot on. Orange you have the patience of a saint. Me on the other hand will refrain from my comment!

Your grandmother paid for an addition to your cousin's house where she lived for three years under your cousin's care? She spent that money for her own benefit and comfort - not to increase your cousin's property value, although I'm sure that ended up as a side benefit. Sorry, I'm no legal eagle, but the house and the additon are considered 'real' property owned by your cousin, regardless of who paid for the addition. Personal property would be all other personal possesions owned by your grandmother (which you say she left to your cousin in the will). Sorry, but I honestly do not think you have a claim here.

This one is a no-brainer. Unless there was specific legal paperwork drawn up that was a condition of the addition, the addition belongs to the owner of the property.

the home addition should be divided 6 ways imo. each relative would get 27 sq ft of living space and 1/3rd of a furnace duct.

I don't know the legality of this but it sounds as though it was your grandmother's personal property and therefore goes to your cousin. Only a lawyer can sort this out. Assuming your cousin took care of your grandmother this seems only fair. this is a lesson for everyone to have proper legal documents drawn up so this situation does not arise.