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Communication: How does it prevent estate litigation?

estate planning Apr 17, 2019

The merging of blended families and the resulting combined estates has created the perfect storm for a flood of estate litigation. Beneficiaries, or people who think they should be a beneficiary, are lawyering up and heading to court like never before to fight for their perceived right to a piece of the pie. Justice is a relative concept depending on where you sit and the fight for this style of justice has never been more expensive.

My advice to clients who are upset and want to fight about the principle of the matter has always been the same…settle quickly and be angry at the person who left the mess. Why? There is an easy way to prevent estate litigation.  The person writing the Will has to lift the veil of secrecy around their Will.  The easiest way to do this?  Hold a family meeting where the beneficiaries can be told about your estate and what their inheritance will be, if any. Holding this meeting may seem a little daunting, but this is a much better way...

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The Top Eight Mistakes Made by Executors (Part Two)

executor Apr 10, 2019

Being an Executor isn't easy.  There's a lot of paperwork to be done, lots of interaction with government agencies, Alberta Registries, banks, insurance companies, accountants, realtors and lawyers.  And there's always beneficiaries pressuring you to do things quicker or are questioning everything you do.  It comes as no surprise that Executors make mistakes.  We thought we would look at the top eight mistakes Executors make:

In our last blog post, we discussed the first four mistakes that many Executors make:

  • Mistake #1 - Executors Do Not Keep Proper Records
  • Mistake #2 - Executors Do Not Get Proper Valuations of the Estate Assets
  • Mistake #3 - Executors Treating Estate Money as if it is Their Own
  • Mistake #4 - Executors Do Not Follow the Will

Mistake #5 - Executors Try To Do Everything Cheaply. 

It's certainly not a bad idea to keep estate administration costs low, but unfortunately the way many Executors go about that ends up costing the estate more...

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The Top Eight Mistakes Made by Executors (Part One)

executor Apr 03, 2019

Being an Executor isn't easy. There is a lot of paperwork to be done, a lot of interaction with government agencies, Alberta Registries, banks, insurance companies, accountants, realtors and lawyers. And there are always beneficiaries pressuring you to do things quicker or questioning everything you do.  It comes as no surprise that Executors make mistakes.  We thought we would look at the top eight mistakes Executors make: 

Mistake #1 – Executors Do Not Keep Proper Records

Executors need to keep this in mind “If there is no ledger, they will allege.”

Nothing causes beneficiaries to call a lawyer quicker than an Executor who cannot give them a breakdown of what the estate financials are.  Executors should keep a log that tracks all of their mileage and any expenses they incur while performing their duties.  These records should outline what you purchased for the estate, the amount and why.   Executors also need to keep detailed...

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Why Joint Ownership on Vehicles Can Be a Good Thing

wills Mar 27, 2019

We recently had a client call our office looking for help. The client stated that her husband had passed away 3 months ago and did not have a Will. She was calling because they owned some collector vehicles that had a considerable value, and when she went to transfer the insurance into her name, the insurance company refused to do so because she was not the registered owner of the vehicle. When she contacted the local Registry Agent, she was told that the only way they would complete the transfer is with a death certificate and a copy of the Will.  In the alternative, she was told a letter from a lawyer stating that she was the rightful beneficiary would suffice. Our office had never met her or her spouse, so we were unable to provide this letter and would have had to move forward with a Grant of Administration application. All this stress on the spouse could have been avoided if her spouse had written a Will, or alternatively, made sure the vehicles were registered in joint...

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Should I choose more than one child as Executor?

executor Mar 20, 2019

Your Executor/Executrix* is the person that carries out the provisions of your Will and settles your estate. It’s not an easy job, and it requires a significant investment of time, emotions and resources. You may think that sharing this responsibility among your children will make things easier for them, but that is not the case.

An Executor has to make firm decisions, sign off on documents and provide input into often sensitive situations. Having to constantly chase another person to make those decisions or to get a required co-signature can slow down the process and make the job twice as difficult. It is also highly unlikely that the two Executors will agree on everything and this can be the cause of long-lasting resentment between them.

Perhaps you don’t want to offend one of your children or you do not trust that any of your children have the skill set needed to perform these duties. In this case, instead of naming Executors within your family, you can appoint a...

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Puppy Love: Who will take care of your pets when you are no longer around?

estate planning Mar 13, 2019

Our office is seeing more and more people who are worried about not only what happens to their children when they die, but also who will be taking care of their beloved pets. 

Our lawyers recently met with a vibrant middle-aged client who had a beloved pet Cockatoo named Tootsie. Our client wanted to make sure that Tootsie went to a good home after she died and needed to make sure that the person who took care of her liked birds. She had asked her friends, but given there ages, they were worried about agreeing to take care of Tootsie. You see, Tootsie had a projected lifespan of almost 40 years, and many of our client's friends may not be around to make sure she had a home.

In that case, we found a local bird trainer who agreed to take care of Tootsie if and when our client flew off to the great blue yonder! To ease the cost burden on the bird trainer, we left her $5000.00 in the will to be used for the care of Tootsie. 

In addition to the legacy,...

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Five Estate Planning Questions for a Family Business

business estate planning Mar 06, 2019

Sadly, many family businesses don’t survive after being transferred to the next generation.  This is often due to a lack of effective succession planning – and a vital component of any succession plan is careful estate planning!

Take a moment to consider the following estate planning questions:

  • Do you have a buy-sell agreement with any co-owners of your business that will be triggered upon your death? If yes, do you understand the effect of these provisions and is your family aware of them?
  • Do you have a plan in place for if you are incapacitated before transferring your ownership interest in your business?
  • Have you appointed a successor or established a process for selecting a successor for your business?
  • If you are leaving the business to a family member, have you made arrangements to give other family members assets of similar value?
  • Have you taken steps to minimise the potential tax liability related to your business that your estate may face upon your death?
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Succession Planning With a Family Business

business estate planning Feb 27, 2019

One of the most preventable causes of a failure to sustain a family business across generations is a lack of preparation and in particular, the development of a succession plan. Unfortunately, a considerable portion of family businesses have no succession plan in place.  

Below you can find a list of a few simple steps that can be taken within a family business to increase the chances of a smooth transition of the company from generation to generation.  Of course, there are numerous more technical estate and tax planning tools that should also be considered, and we recommend that all owners of a family business consult with an estates lawyer to learn more about these tools.

COMMUNICATE – ALWAYS COMMUNICATE!

Communication is key to ensuring that all of the parties involved understand their roles, responsibilities and expectations.  More importantly, the discussion provides that everyone agrees with the plan and is on the same page.  It is not uncommon...

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Protecting Your Business from Capital Gains Tax

estates tax Feb 20, 2019

As a business owner, your estate plan should address both your personal and business assets. However, estate planning for business owners is more complicated as it needs to address potential tax issues.  If you want to maximize the wealth of your estate by minimizing its tax burden, an estate freeze is a useful tool. 

CAPITAL GAINS TAX

Any assets not inherited by the surviving spouse or common-law partner are a “deemed disposition” immediately upon death.  This is primarily treated as a sale at fair market value, which is subject to capital gains tax.  If the value of your business has grown over the years, this could leave your family and estate with a potentially significant financial burden. 

Your business is part of your estate, and its value as an asset can be significantly depleted by capital gains tax!

ESTATE FREEZE

An estate freeze, where the value of your business is frozen as of a certain date, is one of the most useful ways to...

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Tips for Being an Excellent Executor

executor Feb 13, 2019

Generally, our Mondays begin in the same way: We have an answering machine filled with messages from Executors for our clients who have passed away. The Executors are in a panic because they do not know where their loved one's assets are located, what they should be doing, or if they would like to take on the job of acting as an Executor.

To help our clients and future clients, we have drafted a list of ten tips for performing as an Executor. If you are an Executor and have additional questions or need more information, please contact our office today.

 

TIP ONE: YOU MUST FOLLOW THE WILL

  • As Executor, you may not think its fair if the beneficiaries are not given an equal share of the estate, but your job is to do what the Will states.
  • You also cannot give personal items to those not entitled to them. For example a Royal Doulton figurine to a niece who is not listed in the will.

VALUATIONS

  • Wherever possible you should get appraisals on all assets, otherwise as Executor you may...
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