Insolvent estates add stress to a sad situation

An insolvent estate adds a layer of complexity to an already emotionally fraught situation. I was recently interviewed by Advocate Daily on this issue. For the full article, click here.

Digital assets and estate planning – the new normal

As society moves toward an online existence, it becomes increasingly important to account for our digital presence in our wills and in estate planning. I was recently interviewed by Advocate Daily on this issue. For the full article, click here.

What is the Canada Pension Plan Death Benefit?

The financial issues that arise from the death of a loved one can cause a significant amount of stress. It is important to look at all the options available to you to help defray the costs.

The Canada Pension Plan offers a one-time lump-sum death benefit following the death of a contributor to the plan. The amount of the benefit depends on the deceased’s payments into the plan. The maximum benefit payable is $2.500.00.

You must have contributed to the plan for a minimum of three years for your estate to be eligible for this benefit. Also, if you contributed for more than nine years, then contributions must have been made in the lesser of either one-third of the calendar years in the contributory period, or made a contribution in at least 10 calendar years.

The executor must apply for the benefit within 60 days of the death. Sometimes, there is no executor because the deceased did not have a will and no court application has been made (and, often, no application will be made) to appoint an Estate Trustee. In such cases, the death benefit may be paid to the person who paid the funeral expenses, or to a spouse or next-of-kin of the deceased.

Information on how to apply is available here.

If you have questions about administering a loved one’s estate, get started with Journey Law PC by calling 613-933-7720.

Katherine Humphries Joins Journey Law Professional Corporation

Downtown Cornwall law firm, Journey Law Professional Corporation has brought in a new lawyer to the team and offers a warm welcome to Katherine Humphries.

Katherine was born in Glengarry County and was called to the bar in 2009. She began her career as a litigator before broadening into a wider range of areas including real estate, wills and estates, corporate work and mediation, offering mediation through Humphries Mediation.

The firm has continued to grow and adding Katherine to the team will help our firm meet the ongoing demands of our clients in Cornwall and surrounding areas.

To make an appointment with Katherine Humphries, she can be reached at 613-933-7720 or by email at katherine@allinottelawoffice.com.

How long does probate take?

As an estate administration lawyer in Cornwall, Ontario, one of the most frequent questions clients ask me is, “How long does probate take?”

Probate isn’t the actual legal term in Ontario any longer, but we use it commonly to refer to the process of obtaining a Certificate of Appointment of Estate Trustee (with or without a Will), and the lengthier process of realizing assets and administering an estate.

When my office gets the call that an individual has passed away, we try to meet with the estate trustee (and sometimes with other loved ones and beneficiaries) as soon as possible. In that initial meeting, we review whether the deceased had a will, if the will can be located, if the will is the last will and is valid, and what assets the deceased owned on death. This is the investigation stage, where we are collecting the information that we need to complete the application to court, and whether a court application is needed at all. Not all estates require probate, and a lawyer can review and advise if probate is needed.

Normally, the process of getting the application ready for court shouldn’t take too long for a law firm experienced in dealing with estates matters. Often delays will come from waiting for information from third parties, or  possibly for consents or renunciations from beneficiaries or estate trustees who are not prepared to take on the task. We need to collect all the facts and take care of some preparatory issues before we can submit the application. In my office, we can usually gather the information and complete the application in a week or two, but sometimes we are waiting weeks or months for information from other places.

Once the application is submitted to court, the time it takes for the court to have a judge sign it varies widely. Judicial resources are required to process the applications that each court receives. If the application is not full and accurate, this can cause major delays. It is important that your lawyer is familiar with all the rules and can complete the application accurately and efficiently. In the Cornwall area, sometimes an application can be returned within a week or two, while other times, it can be over two months.

Once the application is returned from the court, we have the Certificate of Appointment and the estate trustee is now in a position to deal with the assets of the estate. Typically, this does not mean that the estate trustee can write cheques to beneficiaries immediately. Assets need to be realized – accounts closed and funds transferred, homes and personal property sold, et cetera. It is rare for an estate to be in a position to make payments to beneficiaries until several months after the death.

Once the estate trustee has started to realize assets, he or she also needs to deal with taxes. The deceased’s income taxes need to be completed, and the estate will also have income taxes to deal with. Some assets will create tax liability on the estate when they are realized. As a result, often the estate is on hold until tax filings are completed and Canada Revenue Agency has advised if there are any taxes owing. The tax issues typically take the longest to resolve, even in simple estates.

With all of these steps, it is not at all unusual for beneficiaries to have to wait a year after death for some of their inheritance. Typically, part of the estate will be held back and not distributed until all the tax issues are resolved. On some estates my office has dealt with, we have waited two or three years after death for taxes to be completely resolved and, at that time, the estate can be finalized and our file closed.

Michele R.J. Allinotte is the owner of Journey Law Professional Corporation in Cornwall, Ontario and she helps her clients make the best decisions for themselves, their families and their businesses. Her practice focuses on the areas of business law, estate planning & estates and real estate. Visit www.YourCornwallLawyer.com for more information or to make an appointment.