Difference between revisions of "Preparing a Will and Estate Planning"
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*'''Joint Assets''': The owners of joint assets, such as a joint bank account that two or more people own, or a house owned by two or more people as joint tenants, have a “right of survivorship.” This means that when one person dies, the other joint owners are entitled to own the asset. So if you and another person own a house as joint tenants, the surviving joint owner will get the house when you die. The house is an asset that passes outside your will. No probate fees will have to be paid by your estate regarding the house, and if the house is your principal residence, no tax will be paid by your estate. | *'''Joint Assets''': The owners of joint assets, such as a joint bank account that two or more people own, or a house owned by two or more people as joint tenants, have a “right of survivorship.” This means that when one person dies, the other joint owners are entitled to own the asset. So if you and another person own a house as joint tenants, the surviving joint owner will get the house when you die. The house is an asset that passes outside your will. No probate fees will have to be paid by your estate regarding the house, and if the house is your principal residence, no tax will be paid by your estate. | ||
However, note that several recent court rulings have returned a jointly-owned asset to the estate. If your joint asset is not with your spouse or a minor child, but instead is with an adult child or other adult, then that joint holder may in fact own the asset in trust for you. This can be avoided by clear documentation showing your intent to give the property to the surviving joint owner when he or she becomes the joint owner. So, if you add an adult son to your bank account as a joint holder, and you want the account to belong to him when you die, you should sign a deed of gift. Otherwise, it may be presumed that your son holds the bank account in trust for your estate, and the money will be paid out according to the terms of your will. | :However, note that several recent court rulings have returned a jointly-owned asset to the estate. If your joint asset is not with your spouse or a minor child, but instead is with an adult child or other adult, then that joint holder may in fact own the asset in trust for you. This can be avoided by clear documentation showing your intent to give the property to the surviving joint owner when he or she becomes the joint owner. So, if you add an adult son to your bank account as a joint holder, and you want the account to belong to him when you die, you should sign a deed of gift. Otherwise, it may be presumed that your son holds the bank account in trust for your estate, and the money will be paid out according to the terms of your will. | ||
*'''RRSPs, RRIFs and TFSAs''': A Registered Retirement Savings Plan(RRSP), Registered Retirement Income Fund (RRIF) and Tax Free Savings Account (TFSA) all allow you to designate a beneficiary to get the proceeds when you die. If you name a beneficiary and he or she survives you by at least five days, the proceeds pass outside your will to that beneficiary. So, for example, an RRSP beneficiary will get the money in the RRSP directly from the company holding the RRSP, and not from the estate. | *'''RRSPs, RRIFs and TFSAs''': A Registered Retirement Savings Plan(RRSP), Registered Retirement Income Fund (RRIF) and Tax Free Savings Account (TFSA) all allow you to designate a beneficiary to get the proceeds when you die. If you name a beneficiary and he or she survives you by at least five days, the proceeds pass outside your will to that beneficiary. So, for example, an RRSP beneficiary will get the money in the RRSP directly from the company holding the RRSP, and not from the estate. | ||