You’ve spent a lifetime building your estate so that you have a legacy to leave to your loved ones. However, at death, taxes and other expenses can severely reduce the value of your estate particularly if your assets have increased in value. How can you protect your estate from being eroded by taxes?

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The JONES DesLauriers Blevins Team can help to maximize your estate by employing Tax Sheltering strategies which will minimize the amount of taxes and other expenses that your estate will be liable for and may include:

  • Keeping certain assets out of your estate. As long as you have named a beneficiary, life insurance policies and segregated funds won’t be considered part of your estate for probate fees
  • Naming your spouse/common-law partner as your RRSP/LIRA/RRIF/LIF beneficiary because at death your registered assets can often be transferred directly to their registered assets without any tax liability
  • Leaving your assets to your spouse/common-law partner because deemed disposition (when a person is considered to have disposed of a property, even though a sale did not take place) rules generally don’t apply when you leave your assets to your spouse/common-law partner. However this only defers the tax bill because when they eventually transfer the assets on, a deemed disposition will occur
  • Naming your under age children as beneficiaries of your registered assets if you do not have a spouse/common-law partner. This will transfer the assets tax free into their name. The funds must be used to purchase an income producing annuity that pays the full amount until the child is 18. They will pay tax as they receive the money. Always remember to appoint a trustee when leaving any assets to under age children
  • Giving assets away prior to death
  • An Estate Freeze can help transfer the future growth of certain assets to your heirs. You can use your capital gains exemption to avoid tax at the time of the disposition of the assets. In the future, as the value of these assets increase, your beneficiaries can utilize their available capital gains exemptions to further avoid income tax
  • Having your executor make a final contribution to your RRSP after your death. If you are over 71 years of age you cannot make a contribution to your RRSP. If your spouse is younger than 71, your executor may make the contribution to a Spousal RRSP allowing a deduction to be claimed on your final tax return
  • Having your executor make a donation to charity upon your death which will generate a tax credit on your final tax return
  • Using a Trust to create a tax shelter for your beneficiaries by reducing the tax rate on the investment income from the inheritance
  • Using a Life Insurance Policy as a tax shelter and to possibly eliminate your future capital gains tax liability at death