October 2016 - Garton & Harris

Estate litigation concerns for British Columbia residents

October 28, 2016/in Estate Administration & Probate/by gartonandharris

Estate litigation is exactly what every diligent estate planner is trying to avoid, but sometimes, the best-laid estate plans can fall subject to challenges in court after the estate planner passes away. This is where a qualified estate planning lawyer can be very helpful in assisting families to assert their beneficiary rights in court.

The lawyers at Garton & Harris have represented countless British Columbia families in estate litigation proceedings. Typically, the types of issues we address in these kinds of legal proceedings include:

— Challenges relating to the mental capacity of the deceased individual when the will was drafted.

— Challenges asserting that the deceased was subjected to undue influence and/or coercion at the time the will was created.

— Claims that the will fails to meet legal requirements relating to signatures and witnesses.

— Allegations that the deceased failed to appropriately provide for his or her spouse and/or children in the will.

— Issues related to assets that were not included in the will.

The reasons for estate litigation are virtually endless. For example, beneficiaries could become dissatisfied with the way the estate administrator is managing probate for the estate. Or, beneficiaries might try to request that the trustee of a trust involved in an estate be removed and replaced with someone more competent.

At Garton & Harris, our lawyers are available to listen to the concerns of British Columbia families involved in an estate-related disagreement. We are also available to help families prepare their estates in a way that minimizes the chances of estate litigation as much as possible.

Vital terminology for estate planning in British Columbia

October 20, 2016/in Wills/by gartonandharris

British Columbia residents who are unfamiliar with planning their estates and what is involved with the process may want to familiarize themselves with some vital terminology. This article will discuss some key buzzwords and terms that you will want to know:

— Will: A will is a document that is written out — usually by a lawyer — in order to detail the estate planner’s wishes to be carried out in the event of his or her death. The will says how the individual’s assets will be distributed to heirs, family members and loved ones. The document goes into effect following the will planner’s death.

— Trust: A trust is usually created by the trust grantor in order to benefit particular individual, also known as the beneficiary. The beneficiary in some cases could be the same person as the grantor. The trust is managed by an individual referred to as a trustee, named by the trust to carry out the instructions within the document. There are a wide variety of trusts types available and the documents are generally flexible and can be tailored to the grantor’s unique requirements.

— Power of attorney: A power of attorney is a special document providing special rights to a particular individual who can act on the POA creator’s behalf.

— An estate: In estate planning, the estate refers to the property belonging to an individual. The estate is generally what an individual leaves behind after he or she passes away.

These are the absolute most basic terms a British Columbia resident, new to the world of estate planning, will encounter. By getting assistance from an estate planning lawyer, individuals can finalize their estate plans, wills, trusts, powers of attorney and any other associated documents.

Source: Ontario Ministry of the Attorney General, “Wills, Estates and Trusts,” accessed Oct. 20, 2016

Being an estate executor can be a very stressful experience

October 14, 2016/in Wills/by gartonandharris

British Columbia residents who have been appointed to serve as the executor of a deceased loved one’s estate will no doubt feel honored by the fact. However, serving as executor can be one of the most stressful jobs that anyone has to perform.

What estate representatives particularly need to realize is that they may have to deal with a multiple of beneficiaries, arguing family members and/or assets that are outside of the country (or outside the province) that different laws apply to, and complications could abound. Generally, the more assets and money involved in the estate, and especially if a currently operating business is involved, the more complex it will become.

The fact is, serving as an executor is a difficult job, it is not always a very easy one and estate executors will probably have a lot of work to do. An estate executor also has to be well-organized and a great record keeper. Furthermore, if something goes wrong or the estate executor makes a bad decision, he or she could be liable financially for his or her mistakes.

Given the difficulties of the job, individuals who are planning their estates are well-advised to consider the particular challenges that their estate executor will face before deciding who will complete the job. Furthermore, those who have been selected as estate executors may want to consider contracting the services of a qualified tax lawyer and estate lawyer. Individuals who are planning their estates may even want to consider incorporating a directive in their estate plans to appoint and pay for a lawyer who will assist in carrying out the executorship duties in this way.

Source: The Globe and Mail, “Being the executor of a will most likely the most stressful experience you’ll ever have,” Augusta Dwyer, accessed Oct. 14, 2016

2 potential liabilities that may need to be paid at death

October 7, 2016/in Estate Administration & Probate/by gartonandharris

British Columbia residents should be aware that Canada does not have true “estate taxes.” However, certain liabilities may need to be paid upon the death of a loved one, by the estate of that loved one before the estate’s assets may be distributed. Those include income tax due to deemed disposition and Registered Retirement Savings Plans and Registered Retirement Income Funds.

Whenever an adult Canadian passes away, the estate executor must pay the income tax due to deemed disposition by filing a terminal tax return on behalf of the individual. This tax return will account for all income earned during the year up to the day the individual passed away. In addition, the net capital gain must be included in the total income.

Tax liabilities related to recognized capital gains are not the only liabilities that may need to be paid out of a deceased individual’s estate. Registered assets like RRIFs and RRSPs also need to be deregistered, i.e., collapsed. The values of RRIFs and RRSPs need to be put into a deceased individual’s terminal tax returns. However, if the RRIF and RRSP are left to a spouse, common law spouse or in certain situations children and grandchildren, there may exist an exception to the deregistration requirement.

British Columbia residents might want to consider speaking with an estate planning lawyer to ask about the estate administration and probate process relating to their deceased loved. An estate lawyer can help families determine what tax liabilities their loved one’s estate may face and also identify strategies for reducing the estate’s tax burden.

Source: RBC Wealth Management, “Taxes at Death,” Oct. 02, 2016

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