Regardless of your age and the extent of your assets, having a Will gives you a say over who your heirs will be, often reduces fighting among your loved ones when you are gone, and can result in more money going to the people you choose. While we would all like to think we will live forever, the reality is that each of us has a time, and none of us knows when it is.
An intestacy occurs when a person dies without a Will. Here are some implications of dying intestate in Ontario:
- You have no control over who takes charge of your estate and distributes your assets.
- You have no control over who inherits your estate. Your estate will go to the people set out in legislation - not necessarily the people you would have chosen.
- If you are married, your spouse will inherit the first $200,000 of your estate and the balance will be divided between your spouse and your children. This is true even if you and your spouse are separated. It is also true even if your children are babies and your spouse is their other parent. On the other hand, step-children whom you treat as your own but have never formally adopted will have to bring an expensive application to even try to receive anything.
- If your children are under age 18, their inheritances will be held under the control of the accountant of the Superior Court of Justice, who will then release all their money when they turn 18. What would you have done with a financial windfall at age 18?
- If any of your beneficiaries are disabled and receiving government assistance, their inheritance might cause them to lose their benefits. (A carefully drawn Will can avoid this outcome.)
- The person applying to be your Executor may be required to obtain an administration bond before the court will grant the application. This cost will come out of your estate, reducing the amount available for your heirs.
- Your estate may pay more in probate taxes, calculated as 0.5% of the value of assets up to $50,000 and 1.5% of the value of assets over $50,000. Again, increased costs mean your heirs receive less in the end.
- You lose a terrific opportunity to leave a charitable legacy, along with the tax benefits of doing so.
If you do not have a Will, chances are you also do not have Powers of Attorney for Property or Personal Care. Without these documents, you have no say in who would act on your behalf if you became incapable of managing your assets or personal care - including healthcare decisions.
For more information about how we can help you with your estate plan, please contact us at [email protected]
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