Archive for the ‘Estate Planning’ Category
Monday, April 19th, 2010
If parents are separated or divorced, a custodial appointment in a parent’s Will is only effective if that parent was entitled to custody of the child at the time of the parent’s death. It is essential that both parents, especially those who are married or who have joint custody due to separation or divorce, reach a consensus as to who should be appointed custodian. If parents name different custodians in their Wills and then the parents die in a common accident in circumstances that make it impossible to determine who died last, neither of the custodians named will have custody.
Many parents, whether biological or adoptive, are surprised to learn that they do not have the right to name a permanent custodian of minor children. (more…)
Posted in Custodians of Children, Estate Planning, Guardians of Children, Minor Children, Young Children | Comments Off
Thursday, April 8th, 2010
Although not a subject many parents like to think about, parents of a minor child (under the age of 18) should consider who will look after their child if both parents die. This is a decision often debated and agonized over but, all too often, ignored. Hopefully, the information provided over the next few weeks will help you make an informed decision and will encourage you to put that decision in writing.
Although the term guardian is commonly used to mean a person having custody of a child, the correct legal term is ‘custodian’. (more…)
Posted in Custodians of Children, Estate Planning, Guardians of Children, Minor Children, Young Children | Comments Off
Friday, March 26th, 2010
Think your separation agreement ensures your ex won’t get your insurance payout? Think again.
While married, Jack named his wife, Sharon, as the beneficiary of his life insurance policy. Some years later the couple separate. They negotiate and sign a separation agreement which states that neither of them will have any claim against the other’s estate. Jack does not change the beneficiary on his life insurance policy thinking it has been dealt with by the separation agreement. Jack dies. The insurance company pays the insurance payout to the named beneficiary, Sharon. (more…)
Posted in Estate Planning, Marriage Breakdown, Separation | Comments Off
Friday, March 19th, 2010
Adult Children
Parents wishing to give their adult child tax advantages that the child could not otherwise enjoy should consider including a trust in their Wills. A testamentary trust is treated as a separate taxpayer and the income earned by the trust is taxed at graduated rates (the more the trust earns, the more it is taxed up to a certain limit). (more…)
Posted in Estate Planning, Trusts | Comments Off
Friday, March 12th, 2010
Children Under the Age of 18 (Minors)
A parent (or other person leaving a gift to a child) who wants to delay payment of the inheritance beyond the age of 18 must include a trust in his or her Will. Otherwise, the inheritance will be handed over to the child at age 18. If a trust holds the child’s inheritance, a parent can specify how much the child receives and when. (more…)
Posted in Estate Planning, Minor Children, Trusts, Young Children | Comments Off
Monday, March 1st, 2010
The world of trusts is fascinating, if not somewhat enigmatic. Trusts, in general, are an important part of estate planning because of the beneficial tax treatment of testamentary (arising as the result of a death) trusts. However, trusts are used by parents and others for a variety of specific purposes besides tax planning. Over the next few weeks, I will offer a brief introduction to some of the ways that trusts are used to protect a child’s inheritance. (more…)
Posted in Estate Planning, Trusts | Comments Off
Sunday, February 14th, 2010
Although getting a Will done ranks right alongside a trip to the dentist, having an up-to-date Will is an expression of caring that can ease the sorrow of your passing. Dying without a Will leaves your grieving loved ones puzzling over why you didn’t care enough to get it done and wondering how to deal with the resulting chaos.
For some of us with few assets and if no one is expecting to have access to our assets, Ontario’s intestacy laws (how an estate is distributed upon death if there is no Will) may be enough. For example, if a married person dies without kids and having most assets jointly-held with his or her spouse, the surviving married spouse gets it all. If the deceased was single and never had kids, his or her parents share the estate. However, having died without a Will means that it will take longer to access the assets and settling the estate will require more time and money.
The distribution dictated by Ontario’s intestacy laws is, in our experience, rarely what people expect and may come as a bit of a surprise. For example, Chris’ marriage ended three years ago but no separation agreement was ever signed. (more…)
Posted in Cottages and Estate Planning, Estate Planning, Intestacy | Comments Off
Friday, February 5th, 2010
With Valentine’s Day approaching, we thought it appropriate to turn our attention to charitable giving. Whether you want to honour a favourite charity, remember a loved one or a special time in your life or simply reduce taxes, charitable giving should be considered as part of your estate planning.
When naming a charity as a beneficiary in a Will, most specify a cash gift (referred to as a ‘legacy’) of a certain dollar amount or the donation of an item of value such as artwork or securities (referred to as a ‘bequest’). From a tax standpoint, a gift in a Will is generally deemed to have been made immediately before the date of death. As a result, a tax credit can be claimed on the final tax return. A tax credit is a deduction in computing tax which would otherwise be payable. (more…)
Posted in Estate Planning | Comments Off
Sunday, January 24th, 2010
During the estate planning process, many important decisions must be made. Although most people focus on who will get their estate, another important decision is who to appoint as executor (also referred to in Ontario as an ‘estate trustee’). Both a primary (your first choice) and one or more alternate executors should be named in case the first choice is unable to do the job. A recent and interesting article by Susan Hughes, entitled “No executor required” published in the November/December 2009 issue of the Canadian Lawyer, shows just how important this choice can be.
Hughes reviews a recent Ontario case, Evans v. Gondor, in which a most interesting situation arose. At their request, the court removed the executors who had been named in the deceased’s Will. The executors, the deceased’s sister and brother-in-law, no longer wished to act and there was no replacement named. This left the estate without an executor. (more…)
Posted in Estate Administration, Estate Planning, Executor | Comments Off
Thursday, January 14th, 2010
If 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…)
Posted in Avoiding Probate, Calculating Probate Fees, Estate Administration, Estate Planning, Probate, Trusts | Comments Off
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