Quote:
Originally Posted by Izzle
Firebug, do effectively execute the will?
I wanted my wife to be the executor of my will, but if something were to happen, I doubt she'd be in the emotional state to execute the will.
I'd much rather have a 3rd party execute the will and have the company take a fee for the services they provide.
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If there are going to be complexities like this, design your will to be mostly automatic in the way that it basically auto executes to your spouse (ie: Rollovers) and there won't be major headaches even if the spouse files tax returns late and whatnot. Consider doing some tax planning so that there isn't a huge tax liability that pops up on the deemed dispositions when you pass away.
If you want to give stuff to your kids, do it while inter vivos (alive) so they cannot contest it while gone AND it doesn't have to be manually done via instructions in the will. Just make sure you know what you're doing tax wise residents, non-residents, deemed disposition on transfers (taxable event). Careful with the will stipulations and joint names (deemed dispositions and new bare trust filing requirements)
For the final return, make it simple so that the whole thing can be wrapped up on the T1final. Just make sure that your accountant knows how to do final returns so you don't have to have your trustees/executors go through the process of going to someone else (ie: DIY tax filings or tax filer who doesn't know final returns).
Final returns + trust returns are far more complex than regular returns due to deemed disposition/rollover rules and special rules. They're many times more complex than yearly filings when someone is alive even when some people say, "The situation was pretty simple". Make sure you don't have someone who doesn't know what they're doing and screw you over several times in the tax savings that were missed out due to the savings you got on their fees. ie: I've seen filings where the death benefit is claimed on the deceased's T1Final. That's incorrect.
Tax preppers also cannot file the return appropriately if information is missing. Duress certainly doesn't help, but many people are suddenly upset that a number "cannot be made up" to fulfill filing requirements.
Once you file and everything is sorted out, make sure to apply for the clearance certificate to close down that tax account.
Approx 10 pages to get up to date to file a regular personal tax return.
https://www.canada.ca/en/revenue-age...ng-season.html
Approx 120+ pages excluding references of what to be aware of when filing a final return.
https://www.canada.ca/en/revenue-age...d-persons.html
Build a binder with all of the relevant tax information (last 3 years), legal information, login-passwords for websites etc. that someone can grab later to carry out your wishes. If you are a spouse that does almost all of the finances, make sure your spouse is aware of what is going on and how to deal with things if you are unable to do so. A portion of setting your affairs in order is more than just prepping everything yourself, but getting others involved so that the transition is smooth without your guidance.
Quote:
Originally Posted by Locke
I have mentioned this a million times from a Tax perspective.
Get a Will.
Get an Enduring POA.
You do NOT want to be in a position where you have to make decisions for people without these documents in place.
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Yep. I've run into a few.
It took months and combinations of searching in a pack rat type home for a needle in a haystack or paying a lawyer to request new copies. If you have a filing, get started early (ie: February). Some things are hard to find, some things require several weeks to request 3rd parties to obtain/re-obtain.
"We don't know where they stored the information, don't know the passcodes, it's in a safe and we haven't found the combination, encrypted computers and we don't know the password, we don't know where they even do their banking + they have 5-6 bank accounts and we don't know which one has their safety deposit box" etc.
And as mentioned above, a final return is a complicated matter. It's not as simple as a typical normal tax filing. You don't want extra stress at a time that's already stressful.
A will/POA is a good start, but you have to review and revise them every 5-7 years. Also, cleaning up your tax situation while alive (if it's a messy tax situation) is very important too. Some of these plans take several years to execute. Preparing these plans often aren't free, but even if it takes around $1-3K to investigate and execute a general plan, it'll probably save that and more in lawyer fees later on anyways. It's worth that and more in stress and headache reduction. That's not including potential tax savings which would be pure bonus.