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Disclaimer: This article is intended for the purpose of providing for your pets, including creating pet trusts. It is to be used only for the purposes of guidance. This article is not intended to be relied upon as the giving of legal advice. It does not purport to be exhaustive.
Whether or not you call them your fur baby, our pets are more than animals for many of us. To many Canadians, they are beloved family members, providing companionship, joy, and comfort.
Because their lifespans tend to be much shorter than ours, we assume we will outlive our pets. However, that is not necessarily true. So, just as you meticulously plan for the well-being of your loved ones in your estate plans, it’s crucial not to overlook your furry or feathered friends.
If you are a pet owner, how can you include your pets in your estate plan? What are your options? That is what we will consider in this article.
The Legal Landscape in Ontario: Pets as Property
Under Canadian law, including in Ontario, pets are considered property, and as such, they lack the legal capacity to own or inherit assets. This classification presents unique challenges when explicitly leaving money or property directly to your pets in your will. However, this doesn’t imply a lack of options for securing their future.
There are three basic ways to ensure your pets are cared for after you’re gone:
- Designate a caretaker
- Designate an organization to act as a caretaker
- Set up a pet trust
Designating a Caretaker: Choosing Guardianship for Your Pet
Similar to appointing guardians for minors, identifying a trustworthy caregiver to care for the pets after you’re gone is crucial. Consider family members or close friends who share a bond with your pets and are both willing and capable of providing lifelong care. A heartfelt conversation with your chosen caretaker is essential to ensure they understand and accept this responsibility. While a primary caretaker is crucial, it’s wise to designate a backup in case your original caregiver is unable to care for your pet.
Additionally, consider charitable organizations or shelters specialized in pet care. For instance, most Humane Societies offer a pet stewardship program, assuming custody and finding loving homes for pets after their owners pass away.
Financial Provisions: Ensuring the Financial Security of Your Pet
To alleviate financial concerns associated with pet care, consider you should leave an amount of money to your pet guardian in your will. This fund can cover expenses like veterinary care, grooming, food, and any unforeseen medical treatments your pet might require.
How much should you leave for pet care? That depends. Consider how long your pet’s life is expected to be, what costs you are currently incurring and other factors.
Incapacity Planning: Securing Care During Your Lifetime
As we have noted before, you need more than a will. What happens if you become incapacitated and can no longer care for your pet? Trusts and powers of attorney can be instrumental in addressing your pet’s care in case of your incapacity. While pets can’t inherit funds directly, a trust can designate funds for your pet’s care, with conditions tied to the designated caretaker ensuring proper care.
Setting up a Pet Trust: Ensuring the Future Care of Your Pets
While various trusts can be drafted, establishing a trust for pets demands precision to ensure its legality and enforceability. As the legal landscape surrounding trusts for pets continues to evolve, three fundamental rules are worth mentioning.
Beneficiary Enforcement and Legal Standing
One crucial element of any trust is that there must be a beneficiary or trustee who can enforce the terms of the trust. Practically and legally speaking, pets obviously lack the capacity to enforce a trust.
Purpose and Charitable Intent
Trusts must serve a clear purpose or have identifiable beneficiaries unless their purpose is deemed charitable. For instance, trusts designed for research and support surrounding a specific disease are considered charitable in Ontario. However, trusts created solely for pets might not meet the criteria for charitable purposes under the law.
Lawful Conditions and Public Policy
A trust can make gifts conditional on specific actions, provided these conditions are lawful and do not conflict with public policy. Creating a pet trust that adheres to these rules involves designating specific beneficiaries. As part of your trust, you can include instructions for the care of your pets. Funds from the trust are allocated for the explicit purpose of caretaking.
Additionally, each trust requires a termination date, signaling the final distribution of the trust fund. In the case of a pet trust, the termination typically coincides with the death of the last surviving pet. Any trust funds left are distributed per the terms outlined in your will.
Creating an Estate Plan For Your Peace of Mind
Navigating the complexities of caring for every part of the family after you’re gone can be overwhelming. Seeking guidance from an experienced estate lawyer, such as the professionals at Beeksma Law, can streamline the process. An estate lawyer can help formalize legal arrangements, ensuring your directives concerning your pet’s care are documented, legally sound, and enforceable.
Incorporating your pets into your estate planning demonstrates a commitment to their well-being and happiness. Your furry friends hold a special place in your heart and deserve careful consideration in your plans for the future.
At Beeksma Law, our dedicated estate planning team understands the significance of including your pets in your estate plans. Contact us today for compassionate legal guidance to secure the future of your beloved pets.
Disclaimer: This article is intended for the purpose of providing an estate planning checklist. It is to be used only for the purposes of guidance. This article is not intended to be relied upon as the giving of legal advice. It does not purport to be exhaustive.
Estate planning is a crucial process. It allows you to make important decisions about the future of your assets, your loved ones, and even your own well-being.
Whether you have a complex or simple estate, putting an estate plan in place is a gift to your loved ones. Planning ahead for the future, seeking professional advice and creating estate planning documents has many benefits. It will make your wishes clear, can help you lower probate fees and minimize your estate trustee’s liability.
In this blog, we will provide an estate planning checklist with many areas to consider. Let’s delve into some of the essential decisions you must make during your estate planning process.
The importance of a proper estate plan
A well-thought-out estate plan is incredibly important. Not only does it safeguard your assets, but it also ensures that your loved ones are taken care of, and your final wishes are honored.
It will help your estate trustee make decisions and move more quickly through the probate process. Without a comprehensive estate plan, the distribution of your assets can become a contentious and complex process, potentially leading to disputes among family members.
However, it’s not just about your last will and testament. You need important documents, such as your powers of attorney, to allow someone to make critical decisions about who will manage your financial and healthcare affairs if you become incapacitated.
Who will be your executor or estate trustee?
The executor of your estate plays a pivotal role in ensuring your wishes are carried out according to your will. Typically, spouses are named as the primary executors, but it’s important to consider alternates, such as close friends or family members, in case your spouse cannot fulfill this role. You can even select two or more individuals to act as co-executors but remember that they must work jointly to manage your estate efficiently.
Your executor administers your estate and carries out many responsibilities. Learn more about choosing the right person for your estate administration here.
What assets do you currently own (including life insurance policies, digital assets, etc.)?
You will want to make an up-to-date list of your significant assets, including any life insurance policies, real property and other items. With regards to property or bank accounts, are there any of them owned jointly with your spouse?
Do you own any foreign assets? If so, note the location if outside your province. Specify the country in which these assets are located. This information is crucial for the smooth administration of your estate, as different countries have varying laws and regulations regarding foreign assets.
Who did you choose as the beneficiary when you completed the beneficiary designation for your life insurance? It’s important to ensure that your selection aligns with your estate documents.
Who are your beneficiaries?
Making a list of beneficiaries is a fundamental aspect of estate planning. Typically, spouses designate each other as primary beneficiaries, followed by their children in equal shares. Additionally, you should plan for contingencies, such as if one of your children predeceases you, ensuring their share goes to their children (your grandchildren).
Who will be your ultimate distribution beneficiaries?
Consider who should inherit your assets if none of your named beneficiaries are alive at your death and they leave no children behind. Common choices for ultimate distribution beneficiaries include siblings, parents, cousins, close friends, or charities. Your estate planning should reflect your preferences for these scenarios.
Would you like to create any beneficiary trusts?
If your beneficiaries include minors, you have the option of setting up a trust to manage their inheritance. You can choose between a “standard” trust, where the minor receives their full inheritance at a specified age (e.g., 18, 21, 25), or a graduated trust, which disburses the inheritance in stages. Clearly define the ages, amounts, and number of disbursements preferred to meet your objectives.
Would you like to create any other trusts?
Trusts can serve various purposes, from minimizing estate taxes to providing for specific needs of your beneficiaries or even supporting charitable causes. Your decision to establish additional trusts should be guided by your financial goals and family dynamics.
Who will be the guardians of any minor children?
If you have minor children, it’s crucial to appoint guardians who will take care of them if you and your spouse are unable to do so. Typically, spouses name each other as primary guardians, followed by close family members or friends as alternates. You can also designate a second alternate to ensure the well-being of your children.
With regards to your guardians, it is advisable to make sure they know that you have chosen them for this serious responsibility.
Are there any specific gifts or cash legacies you would like to bequeath?
If you have particular items or cash amounts you wish to leave to specific individuals or charities, be sure to document these in your estate plan. These specific gifts ensure that your cherished possessions and causes you care about are remembered and honored.
It may be wise to include specific gifts as a schedule to your will. For example, suppose you want a specific piece of jewelry to go to a certain grandchild. However, you then lose that piece of jewelry before you pass away. A separate schedule makes it easier to update specific gifts without having to amend the entire will.
Who will be your power of attorney for property?
Your Attorney for Property will manage your financial affairs in the event of incapacity. Typically, spouses name each other as primary appointees, followed by alternates.
When it comes to choosing co-attorneys, you have the option to decide whether they should act jointly or jointly and separately.
Jointly: If you choose to have your co-attorneys act jointly, they must make decisions together and reach a consensus. This approach ensures that all major financial decisions require the agreement of both co-attorneys, which can provide an added layer of security and oversight.
Jointly and separately: If you opt for joint and separate authority, your co-attorneys can make decisions together, but they can also act independently when necessary. This approach balances joint decision-making and the flexibility for each co-attorney to manage specific financial aspects without needing the other’s approval for every transaction.
You also need to specify when their power of attorney will come into effect. You can decide whether it should take effect immediately upon signing or only upon your incapacity.
If you grant them immediate authority, they can begin managing your financial affairs as soon as the document is executed. This means avoiding any delay involved with determining that you are incapable of managing your affairs. However, it also means that they can make decisions without your direct involvement, which may not be suitable for everyone.
Who will be your power of attorney for personal care?
Your Attorney for Personal Care is responsible for making medical and healthcare decisions on your behalf if you become unable to do so. Typically, spouses choose each other as primary appointees, followed by alternates. Again, if you appoint co-attorneys, decide whether they should work jointly or jointly and separately.
In addition to these decisions, there are other factors to consider.
You should clearly state your organ donor status within this document to ensure your preferences regarding organ donation are respected.
Furthermore, you may want to consider whether your appointee should receive compensation for their role, as serving as an Attorney for Personal Care can be a demanding responsibility.
Lastly, suppose you hold specific religious or cultural beliefs that are important to you with respect to medical treatment and end-of-life care. In that case, it is essential to include them in your document. This will help guarantee that your healthcare choices align with your personal values, providing assurance and preserving the integrity of your healthcare decisions.
What are your burial wishes?
Finally, consider your burial wishes. This may include decisions about cremation, burial, or even specific details such as the choice of cemetery. If you have pre-planned your funeral, provide these details to ensure your wishes are carried out.
Regularly update your estate plan.
Life is constantly evolving, and so should your estate plan. Major life events such as marriage, divorce, the birth of children or grandchildren, changes in financial situations, and even changes in tax laws can all have a significant impact on your estate planning needs. By revisiting and updating your estate plan periodically, you can make necessary adjustments, address any new concerns, and guarantee that your loved ones are well-protected and that your assets are distributed as you intend.
Consulting with an experienced estate planning attorney, as well as receiving accounting or similar professional advice can help you navigate these changes and ensure that your estate plan remains a reflection of your current wishes and goals.
Get started on your estate plan today!
Our estate planning checklist is just the beginning of creating your estate plan . When it comes to the complex legal aspects of planning your estate, Beeksma Law is your trusted and experienced partner. We primarily focus on estate law and with our estate litigation experience, we have the unique ability to craft legal documents that not only reflect your intentions but also minimize potential liabilities.
By reaching out to Beeksma Law, you can be confident that we will handle your estate planning needs with professionalism and expertise, protecting your assets and legacy for future generations.
Disclaimer: This article on estate planning after divorce is intended for the purpose of providing information only. It is to be used only for the purposes of guidance. This article is not intended to be relied upon as the giving of legal advice and does not purport to be exhaustive.
We have talked before about how you want to regularly consider updating your will, especially after a major life event. One that we want to dive into in more detail is during a separation and divorce.
People are usually mired in other legal matters relating to their divorce and estate planning becomes an after-thought, something to handle after the dust settles. In this article, we will talk about why you should look at your estate planning sooner rather than later and what you should consider.
If you are currently separated or divorcing your spouse, we encourage you to book a complimentary consultation with our team to discuss your estate planning needs.
Changes to the Succession Law Reform Act
As of January 1, 2022, the law surrounding divorced and separated spouses was changed. A “separated spouse” means you have been separated for over three months.
For example, suppose you pass away and haven’t updated your will. Your ex is still listed as an estate trustee or beneficiary. Now, they are treated as if they had died before you and those particular sections of the will are revoked.
If you do not have a will (or die intestate), the Act now provides that a separated spouse will not benefit from the estate. Prior to this change, any legally married spouse, whether separated or non-separated, would benefit from the preferential share (the first $350,000) plus either the balance of the estate or an equal share if there are children. The Act no longer extends this entitlement to separated spouses, and they will not be entitled to this preferential share or any other portion of the estate.
When to see an estate lawyer
The law now provides protection for your estate after you have been separated for three months. However, the reality is that something could happen within those first three months. We advise seeing an estate lawyer as soon as you know that reconciliation is no longer an option.
In some separation agreements, there may be provisions that limit your ability to do certain things. You may be limited in making changes to the title to properties you own or change your powers of attorney. Therefore, it would be wise to update or create your estate documents before attending mediation or finalizing a separation agreement.
Property owned with your spouse
There are two ways to own property with someone else: as joint tenants and as tenants in common. Most times, when spouses own property, they own it as joint tenants. If one joint tenant were to pass away, the surviving spouse would take complete ownership of the property.
You may not want to have that kind of ownership with your estranged spouse, so what are your options? The good news is that you can sever your joint tenancy unilaterally (meaning you do not need their permission). This will move the ownership to what we call tenants in common.
The difference is that if you were to pass away before your property is dissolved, your estranged spouse does not take sole ownership of the property. That property becomes part of your estate and will be bequeathed to your beneficiaries.
Working with other agreements
In family law, there are agreements that must be considered, such as separation agreements or domestic agreements. You must make sure that your will and powers of attorney do not contradict those other agreements. If they do not align, you are opening your estate up to litigation. The courts will have to decide which document takes precedence.
Remember, if you have to get the courts involved, your estate will be spending up to tens of thousands of dollars. However, this situation is easily avoided by having documents drafted by an experienced attorney.
Reviewing your existing estate planning documents
You may have a will and powers of attorney already but are unsure how they hold up now that your family’s circumstances have changed. If that is the case, it is worthwhile to have your documents reviewed by an experienced estate lawyer, like the team at Beeksma Law. We will be able to tell you if your current documents still stand or if it is time to have them updated.
Estate planning after a divorce
As your family continues to change, you will need to consider how this affects your estate planning. We discussed this earlier, but you will want to consider how to protect the interests of all family members.
For example, say you remarry or enter into a common law relationship with a new partner. You will want to consider your children from your previous relationships and make specific arrangements in your will to ensure their financial security. On the other hand, you’ll want to provide for your spouse using vehicles like RRSPs and life insurance.
Expert guidance from the estate law experts at Beeksma Law
Our team of estate law experts at Beeksma Law recognizes that wills and powers of attorney are not static documents. They must be adapted to reflect the evolving circumstances of your family. We understand the importance of staying informed about changes in your life that may impact your estate plan.
Whether you are entering a new marriage, forming a blended family, or experiencing other significant life changes, our experienced professionals can provide the guidance you need. We will work closely with you to understand your unique situation. Our team can help you create an estate plan that protects the interests of all family members.
Contact us today to discuss your estate planning needs. We are here to support you and ensure that your estate plan remains relevant and effective as your family evolves.
Disclaimer: This article on estate planning for blended families is intended for the purposes of providing information only and is to be used only for the purposes of guidance. This article is not intended to be relied upon as the giving of legal advice and does not purport to be exhaustive.
More than one in four Canadians in a relationship are in their second or subsequent marriage or common law relationship. That means that many of us have experienced a family in more than one context, with more than one partner and, sometimes, with children from each union.
The nuclear family – two married parents, their own children, and sometimes the grandparents – is no longer the only family structure. Increasingly complex family structures mean making increasingly complex decisions, and nowhere is that more true than in estate planning.
If this situation describes you, it is vital that you do not leave your estate planning to chance. A comprehensive estate plan, including a well-written will and powers of attorney, protects your entire family and your own wishes. We strongly encourage you to contact us today about your estate planning needs. Our experienced professionals can create a plan that is tailored for you and that takes into account all of your family members.
In this article, we will talk about how your estate plan will affect various family members, what you ought to take into consideration and how you can give your family the greatest gift of all – peace of mind.
Estate Law Updates
As we previously noted, on January 1, 2022, updates to the Succession Law Reform Act came into effect. A new marriage no longer revokes a previous will. This means that if you remarry and do not create a new will, your new spouse will not automatically inherit your estate.
Children from a previous relationship
You must make specific arrangements to ensure that the children receive what you wish them to have. While you may assume that your spouse will care for your children after you pass, there is simply no guarantee of this.
If you have children from a prior relationship, the executor of your will or estate plan must take into account their situation and appropriately provide for them. You could also possibly create trusts to ensure that they are cared for financially.
You also want to ensure that your spouse is taken care of properly in the event of your death. This can include leaving them a lump sum, setting up trusts, or other financial arrangements. Your will should also consider any special needs your spouse may have and ensure they are provided for.
You may also want to use vehicles such as RRSPs, life insurance, and other investments to provide for them in the event of your death.
When it comes to your home, you may want to add your spouse to the title now. Otherwise, they find themselves in a vulnerable position upon your death. As tenants in common or joint tenants, they will be protected should the home need to be sold.
However, it is not as simple as registering your spouse’s name on title. There are tax considerations to consider. Therefore, you need to make clear what your intentions are with respect to adding your spouse on title. It may mean creating a resulting trust , or setting up a spousal trust to ensure that the house passes in accordance with your wishes.
Finally, your will should detail any special gifts you want to leave to your spouse.
When you create a will, you may want to consider leaving specific items to particular family members. Your will should detail all gifts, from jewellery to artwork or furniture. This ensures that the wishes you expressed during your life are respected after your death.
Estate Planning: Factors to Consider
When your family situation is complex, it is important that you consider all factors when creating your estate plan. How can you mitigate potential disputes between family members? What financial arrangements can you make to ensure that all of your loved ones are provided for? How does the law impact you and your family’s situation?
First, take an honest look at your situation. Do your children get along with your new spouse? Do you get along with your spouse’s children? If you have children together, along with children from a previous relationship, consider how they are related to each other. Consider also how you would like them to be treated in the event of your death.
Second, consider what assets you have and who will be responsible for them upon your death. This could include your home, investments, life insurance policies and personal items with sentimental value. Consider setting up trusts or leaving money specifically to certain family members to ensure it passes in accordance with your wishes.
Third, give careful thought to who will act as your estate trustee. If there are tensions between family members, you may want to consider an independent and unbiased executor.
Fourth, be open and honest with your family about your wishes. Discussing your will or estate plan in advance can help to avoid confusion and disputes after you pass.
Finally, keep your estate plan updated as circumstances change. Make sure your estate plan reflects any significant life changes, such as a new grandchild or changes in marital status.
Estate Planning With You in Mind
Finally, seek professional advice from a lawyer and financial planner to help you navigate these various factors. You want to ensure that your estate plan reflects your wishes as well as minimizes any tax implications for you or your beneficiaries.
At Beeksma Law, we understand that each family’s situation is unique. We strive to provide you with the advice and assistance that meets your needs. With careful planning, proper preparation and expert advice, you can ensure that all of your loved ones are provided for and that your wishes are respected after you pass.
Disclaimer: This article on executor fees in Ontario and your estate plan is intended for the purposes of providing information only and is to be used only for the purposes of guidance. This article is not intended to be relied upon as the giving of legal advice and does not purport to be exhaustive.
We have previously discussed that being an executor, or estate trustee, is a weighty responsibility. To carry out the terms of the will requires substantial time and energy. These responsibilities include collecting and distributing the estate assets (including large items like any real estate) and paying any debts.
To carry out these duties, the executor must keep accurate records of the estate accounts and all transactions related to the estate. They must also act in the best interests of the estate and the beneficiaries of the estate. Depending on the value of the estate, this can be an onerous responsibility.
It is not surprising, then, that executors often may be entitled to compensation. However, the question becomes, how much can an executor be paid for their role?
In this article, we will outline how to calculate executor fees in Ontario. We will also look at how that applies to multiple executors and others who perform the tasks of an executor.
If you are an executor, you do not need to handle this heavy responsibility alone. You should seek guidance from a lawyer to ensure you carry out your duties correctly and in the estate’s best interests.
How much is executor compensation in Ontario?
Executor fees for administering an estate are provided for in the Trustee Act. It says:
61 (1) A trustee, guardian or personal representative is entitled to such fair and reasonable allowance for the care, pains and trouble, and the time expended in and about the estate, as may be allowed by a judge of the Superior Court of Justice. R.S.O. 1990, c. T.23, s. 61 (1); 2000, c. 26, Sched. A, s. 15 (2).
However, section 61 (5) states, “Nothing in this section applies where the allowance is fixed by the instrument creating the trust.”
What does this mean? The first step is to ask, “Does the will set a flat fee for executor compensation? Is there a clause explicitly stating an amount or percentage of the estate that will be paid to the executor?” If so, that is usually the amount that the estate executor will receive.
Generally speaking, we do not recommend including a clause in the will that will set executor compensation at a specific fee. This is because it can be challenging to determine the size and complexity of the estate beforehand. An amount may have seemed reasonable when drafting the will, but it may not be appropriate when actually administering the estate.
What if there is no provision for payment in the will?
What if there is no amount of compensation stipulated in the will? The Ontario courts have determined five factors in determining what is “fair and reasonable” compensation. These are:
- The size of the estate;
- The care and responsibility involved;
- The time spent by the executor performing the duties;
- The skill and ability demonstrated and required by the executor; and
- The success resulted from the estate administration.
In Ontario, the executor of an estate is generally paid a percentage fee – meaning it would depend on the estate value. Executors generally receive roughly 5% of an average estate. The Court has applied guidelines where an allowance is usually set at 2.5 percent for capital and revenue receipts and 2.5 percent for capital and revenue disbursements.
However, it is vital to remember that this is just a guideline. The court will ultimately decide what is fair and reasonable based on the circumstances of the particular estate. A simple estate may warrant a lower fee than a more complex estate and vice versa.
One fee for one role, no matter how many executors
In some instances, a will appoints multiple people as executors. The amounts listed above apply to anyone who is an executor. For example, let’s say that there are two executors and that 2.5% of the capital receipts is $10,000. The estate would pay $10,000 for both executors ($5,000 each), not $10,000 each.
This also applies to anyone who is not an executor but performs tasks that are part of the executor’s duties. If the executor hires someone to help with the estate, the executor will pay that person from their compensation.
Let’s use estate lawyers as an example. Estate lawyers are careful to carefully document their time. Are they performing work the executor usually does, such as notifying and reporting to beneficiaries? If so, they charge for their time as the executor.
If the lawyer were to charge the estate for those tasks, the estate would (in effect) be paying twice for the same performance. So those costs would be subtracted from the executor’s compensation.
However, on the other hand, a prudent executor is expected to seek out professional advice to ensure that the estate is being administered properly. In that instance, the lawyer would charge their time to the estate, and not deduct it from the executor’s compensation.
Navigating Estate Planning and Executor Fees in Ontario
The role of executor comes with many responsibilities. It can be a daunting task, made even more complicated by the fact that executors are not always familiar with their duties.
That is where we come in. At Beeksma Law, we have a team of experienced estate lawyers who can help you navigate the executor process from start to finish. We can help you understand your responsibilities and provide guidance on how to best manage the duties of an executor.
Our breadth of experience, from preparing estate plans to handling estate litigation, gives us the knowledge and skills to help you through every step. To learn more, please book a call with us today. We would be more than happy to discuss your specific needs.