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Do you need a casket to be cremated?

demise Jan 29, 2020

Caskets are for burial and cremation. Caskets can be made out of materials, from solid hardwood to metal.

A casket can be cremated but most people chose to purchase a cremation container. These containers are used for cremation only. The purpose of a cremation container is to accommodate the deceased in a dignified manner allowing for placement in the cremation chamber. The container is cremated with the deceased and is consumed in the process. Some families choose to view prior to cremation and the cremation container is used for that purpose as well. The simplest container available is made from cardboard and others are made from various woods. All containers except for the cardboard container have a lined interior and come with a pillow

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Should my 18 year old have a will?

In Alberta, most people have to be 18 years of age to write a will. There are a variety of exceptions to this rule, for example if you a minor has a child or is a member of the military then you may be able to write a will while you are a minor. However, by and large most minors are unable to create a will in Alberta until their 18th birthday. 

Should your child write a will when they turn 18?

Like so many things in life, the answer depends on your child circumstances. Some reasons to have your child write a will include:

  1.  Do they have property? For example did they inherit money from a grandparent?
  2. Are they estranged from a parent or sibling and want to make sure this person doesn't inherit property if they die?
  3. Have they moved in with a girlfriend or boyfriend and want to make sure that these people do/do not inherit money if they die?
  4. Do they owe money to people and need to deal with these debts if they die?
  5. Do they have an illness or a risky occupation or hobby that...
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Protecting the Interests of your Children in a Blended Family

estate planning Jan 15, 2020

Blended families are becoming increasingly common and often face several estate planning challenges. Consider the following scenario:

Don and Pat were married in 2000, and it was a second marriage for each of them. Don had 1 child from a prior relationship, and Pat had 3. Don and Pat had equal financial assets at the time.

While drafting their wills in 2009, Don and Pat agreed that all property would transfer to the survivor of Don and Pat on the death of the first of them. They also agreed that, on the death of the survivor of them, all property would be divided equally among their 4 adult children.  Their wills were drafted accordingly and endorsed.

Five years later, in 2014, Pat passed away, leaving Don to inherit all of the couple’s property. In 2017, Don endorsed a new will.  The new will did not include any mention of Pat’s children, and so Pat’s 3 children could not inherit anything from Don and Pat’s estate.  Don’s singular child...

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Do I have a right to be shown the Will?

wills Jan 08, 2020

Every month, our office receives calls from people who are seeking legal advice on their right to view a Will. They tell us that the executor of an estate is refusing to show them the document and they want to know what their rights are; and the answer to this depends on who they are and what their relationship is with the deceased. Let us explain.

An executor is entitled to maintain the privacy of the deceased. There is no legal obligation for them show the Will to anyone, nor do they have to provide the document to anyone who requests a copy. Further, there is no legal right for anyone to demand to view a Will shortly after a death. If the Will is being held by a lawyer, that lawyer has no obligation to provide a copy of the document to anyone other than the executor of the estate. The hired lawyer acts under the direction of the executor, and unless they were instructed to share the Will, they cannot distribute copies to family members or to friends of the deceased.

In Alberta,...

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It’s a New Year: Make or Update Your Will!

wills Jan 01, 2020

Many of us make New Year’s resolutions each year and, more often than not, these resolutions prove to be unsustainable. In fact, right about now, you may be starting to question whether or not you will be able to achieve some of your goals! Making a new Will or updating an existing Will is a resolution that is relatively easy to achieve.   

Two of the most important functions of a Will are:

  1. To appoint an executor to manage your affairs and wrap up your estate when you are gone; and
  2. To direct how and to whom your assets are to be distributed. 

That said, there are other significant issues that can be addressed through a Will.  If you have minor children, or a disabled child, a Will can name a guardian and set out your wishes with respect to the distribution of your estate to your children and/or their guardian.  A Will can also establish a trust or some other means of managing assets to benefit a disabled child.  Tax planning, the making of...

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Can an executor be liable for the deceased's debts?

executor Dec 18, 2019

In Alberta, the Estate assets must be used to pay any outstanding funeral expenses, burial expenses, taxes, credit cards or other debt. Distributions to beneficiaries cannot be done until all debts are paid. 

What happens if there are not enough assets in the estate to cover the debts?

Only the Estate is responsible for the debt. If there is a shortfall, the Executor cannot be forced to pay any of the debts out of their own pocket, unless their actions have created the inability to pay the debt.

Likewise, beneficiaries or family members are not liable for debts. The only time the beneficiaries or family members can be liable is where they have improperly removed assets from the Estate. Even then, their liability only extends to the value of the property removed from the Estate. In certain very limited circumstances where the Executor has acted in a negligent, careless or fraudulent manner, they can be held personally liable. In summary, the majority of the liability rests with...

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What are the best practices for family trusts?

estate planning trusts Dec 11, 2019

Family Trusts are a powerful and effective financial planning and asset protection tool. Traditional reasons for creating a trust include will and succession planning, asset and legal liability protection and asset administration.

However, trusts have evolved as a tax planning and minimization tool, especially for the family business and high net-worth individuals. In many instances Trusts were created solely for tax purposes.

In response, the Government of Canada has slowly been closing tax "loopholes" where trust structures result in favourable tax results and income splitting opportunities. The introduction of the TOSI (Tax on Split Income) which restricts income splitting with individuals not actively engaged in the related business. 

Nevertheless, access to multiplication the Lifetime Capital Gain Exemption remains, as well as the opportunity to split some investment income. 

Here are 10 administration practices to follow to avoid reassessment from CRA Trust...

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The Time to Tax Plan is Now

tax Dec 04, 2019

Taxes are tricky business, making tax planning an essential tool for any business to plan ahead effectively. Regular tax planning can help business owners lower the amount of taxable income, reduce the tax liability, and gain more control  of when tax is paid.  Here are a few reasons that every business owner should make tax planning a priority:

A.) It's All In the Timing -Tax planning is time-sensitive so its critical to allow enough time to implement planning ideas and maximize their benefits. Good tax planning enables your accountant to potentially reduce the burden of any amount of tax to be paid.

B.) Accuracy is key - Inadequately separating business from personal expenses, missing expenses, improper compensation and overall poor record keeping can cause major headaches at tax time. Proper record keeping can help you avoid the watchful eye of CRA.

C.) Keep up with the changes - tax laws are always changing. There have been...

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Capital Gains Tax on a 1994 Property

real estate tax Nov 27, 2019

Recently our office has dealt with several estates where the deceased had purchased property prior to 1994. The property included cottages, artwork, rental properties and business. 

Back in 1994 the government eliminated the general lifetime exemption of $100,000.00 on all capital assets. To make up for the elimination, and to make sure anyone who had property and didn't sell it would still get this benefit, the Revenue Canada (now called the CRA) allowed a one time election (using form T664) that permitted taxpayers to "bump-up" the tax cost of the property by a maximum of $100,000.00. The election made sure that future liabilities would be minimized. In many estates, the executor cannot find the filed election, or even know if the election was filed. 

If you still own property that you made an election on in 1994, make sure that you have a copy of your 1994 return available, and that the executors of your estate are aware of it. This is important to ensure that the tax...

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Executor Compensation: What are the tax implications?

executor tax Nov 20, 2019

An estate executor recently contacted our office and advised that they were unhappy with having to pay the CRA tax on their remuneration for acting as the administrator and trustee of an estate.

Paying taxes are never fun, and we know that – but acting as the executor of an estate is still a job. Similar to working as a teacher, truck driver, or business owner – you are compensated for the work that you perform, and it is treated as taxable income. The money needs to be declared to Revenue Canada.

A way to get around this is to leave your executor behind with a monetary gift as opposed to compensation. However, we would caution you that if funds are left as a gift and not tied to any sort of work, the executor would receive these funds even if they were unable or unwilling to act. Further, the executor could potentially apply for compensation from the courts, receive more than you originally intended, and essentially “double dip.” This is why our office...

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