Problem
Mini Case - Ina
Allan passed away unexpectedly and intestate at the age of 55 in December. He had a wife, Ina, with who he had been married for his entire working life, and three children age 16, 19 and 21. They had the following assets at his death:
Thefamilyhomewasinhisnamewithmarketvalue $1,800,000
The commuted value of his pension was $600,000 and Ina and had no named beneficiary His income in his final year was $110,000
His TFSA was worth $70,000 and had no beneficiary designation
Allan and Ina held a cabin jointly worth $300,000 and ACB $100,000
They had $50,000 in their various joint bank accounts
Required:
1. Assume probate fees are 1.4% of the total estate. Which assets will be included in probate and what will total probate fees be? Indicate which are estate assets and non-estate assets and relevant values.
2. Use the tax table to estimate what taxes will be owing in Allans's estate?
3. What estate settlement costs would you expect for land transfer tax and executor fees?
4. How will the estate be distributed? Who will get what amount and from what mechanism?
5. What is the spousal share? What is the marital share of the home? Can Ina stay in the home?
6. Indicate a good estimate of the commuted value of the pension? What are the options for handling the pension?