A: There is generally no need to update a Will just because you have opened a TFSA account. All assets including a TFSA that you own solely and which are not designated to a beneficiary become part of your estate on death. You can only name a beneficiary for assets such as life insurance, RRSPs, RRIFs, segregated funds and TFSAs. If you name a beneficiary for your TFSA, it will pass directly to that person, if he or she is alive, on your death and will not be subject to probate fees.
Archive for the ‘Avoiding Probate’ Category
Q: I have opened a Tax Free Savings Account (TFSA). Do I need to update my Will?
Monday, April 26th, 2010
Avoiding Probate Fees on Insurance Proceeds
Thursday, January 14th, 2010If the deceased named a beneficiary on a life insurance policy on the deceased’s life, the surviving beneficiary receives the proceeds directly. The insurance proceeds are not included in the value of the estate for purposes of calculating probate fees. However, if the beneficiary has predeceased and no contingent beneficiary has been named, the insurance proceeds are payable to the estate and are included in the value of the estate for probate purposes. (more…)
Everything You Wanted to Know About Probate
Friday, December 18th, 2009What Is Probate?
Probate is the process of legally establishing the validity of a will. As a result, the Court confirms the appointment of an Estate Trustee (or Executor). The Estate Trustee administers and distributes the estate of the deceased person. An Estate Trustee may be appointed with or without a Will. If there is a Will, the Court issues a Certificate of Estate Trustee with a Will. If there is no Will, the Court issues a Certificate of Estate Trustee Without a Will and the estate is distributed according to Ontario’s intestacy laws. When a person dies without a Will, they are said to have died “intestate”.
When Is Probate Needed? (more…)
How Can I Avoid Probate? — Part Five
Tuesday, September 8th, 2009
If you have been following my blogs on this topic, you will, by now, be wondering if it should have been titled ‘How Not to Avoid Probating a Will’. Admittedly, that might be a better title.
Although I rarely recommend that a parent try to avoid probate between generations because of the many problems that I have outlined in previous blogs, there may be situations where it is a good idea. (more…)
How Can I Avoid Probate? — Part Four
Thursday, September 3rd, 2009
We find that a parent will add a son or daughter as a joint owner of the parent’s bank account to avoid probate fees or to ensure the son or daughter has ready access to funds if the parent falls ill or dies. Although the Supreme Court of Canada has ruled that bank accounts held jointly between a parent and child are considered part of the parent’s estate (assuming the child did not contribute funds to the account), other children who were not joint owners may have to take their sibling to court to recover a share of the bank account if the joint-owner child does not agree. (more…)
How Can I Avoid Probate? — Part Two
Sunday, August 23rd, 2009
Understandably, many of our clients wish to avoid probate. To explore how this might be done, if at all possible, it is essential to review the ownership of all assets, beneficiary designations, family relationships, tax implications as well as relationships among family members and the goals of the client. Only then can we recommend what steps should or should not be taken to avoid probate. Avoiding probate is usually possible when one spouse dies leaving a surviving spouse. For example, probate is not generally required if the spouses own assets jointly or where an asset, such as life insurance, is payable to the surviving spouse by way of a beneficiary designation. (more…)
How Can I Avoid Probate? — Part One
Thursday, August 13th, 2009
In this five-part blog, I will discuss what probate is and how probate fees are calculated, which assets are subject to probate and which are not, when it makes sense to avoid probate and how to accomplish that, and when avoiding probate may not be the best strategy and why. (more…)