Parents' Estate ~$13M — Should We Be Worried About Federal Estate Tax?

My parents are both in their mid-70s and their combined estate is roughly $13 million. Breakdown: house in Connecticut worth ~$2.5M, investment accounts ~$6M, rental property in Florida ~$3M, life insurance ~$1.5M. Dad also has a small pension.

They've done basically zero estate planning beyond simple wills. Mom mentioned "the exemption covers everything" but I keep reading about the TCJA sunset and that the exemption might get cut in half. If it drops to ~$7M per person, are we looking at a massive tax bill?

Also — they live in Connecticut which I believe has its own estate tax? Does that stack on top of the federal?

Any guidance on where to even start? They're resistant to "complicated trusts" but I want to at least understand the exposure.

This is incredibly helpful. I had no idea about the direct tuition/medical payment exception. My niece starts college next year — that could be meaningful.

I'm now building a case to present to my parents. I think starting with the ILIT + annual gifting + 706 filing plan is the most palatable approach for them. The Florida domicile is a longer conversation.

Update: Finally got my parents to meet with an estate attorney. They're setting up the ILIT for the life insurance policy and starting annual gifting to the grandkids. Attorney also recommended a credit shelter trust for when the first parent passes. Total planning cost was around $8K which felt steep but apparently could save $500K-1M in taxes. Thanks everyone for the push.