This site uses cookies.

The types of cookies we use, and the way we use them, are explained in our Privacy Policy. By clicking "Accept" or continuing to use our site, you agree to our use of Cookies.
More information


 

Brian Madigan LL.B., Broker
BRMadigan@Rogers.com

RE/MAX West Realty Inc.,
Brokerage
Independently owned and operated

96 Rexdale Blvd. 
Toronto, Ontario 


Phone: 416-745-2300

Cell: 647-404-8150 
Toll Free: 1-888-507-0817

Search in:  
    
    
       

Sort by:

Transfer of Property to Avoid Probate Fees

May 8, 2019 - Updated: May 8, 2019

Transfer of Property to Avoid Probate Fees
 

Let’s assume that Bob and Mary have been married for years and hold title as Joint Tenants. That’s good because it will avoid probate fees (technically estate administration fees).
 

However, as time progresses either Bob or Mary will pass away. Nothing happens! No one does anything and the property just sits there in Joint Tenancy. But, the Joint Tenancy is finished. It’s done, it’s over. The difficulty is that nothing really takes place. As long as all the bills are paid ie, taxes and utilities, no one cares. And certainly, no one wishes to incur legal fees.
 

Let’s assume that Bob passes away first; Mary now owns the property outright. Now, the problem is: what happens to the property when Mary passes away?
 

Let’s also assume that Mary has five children and many years ago, both she and Bob made Wills leaving everything first to each other, and then to the children equally.
 

We do have something of a problem. If Mary passes, her Estate will need to be probated and assuming further that the property is worth $1 million, then probate fees of $15,000.00 (1.5%) will have to be paid.
 

Question: Could these fees be avoided?
 

Answer: Yes, quite easily.
 

What’s the Solution?
 

Mary needs a simple estate plan. The house should be removed from the Will and registered in Joint Tenancy with one or more of her children. A Trust document should be signed confirming that the Transfer constitutes a “resulting trust” in favour of Mary. So, Mary is still the 100% owner of her property. If she still lives there, the property remains as her principal residence and will be exempt from taxation upon her death (capital gains).
 

This is a simple and straightforward approach. It saves $15,000.00 in probate fees for the estate. Why pay them, if you don’t have to?
 

Brian Madigan LL.B., Broker

www.iSourceRealEstate.com


Tagged with: estates probate fees joint tenancy avoidance estate planning ontario law
| | Share

Brian Madigan LL.B. Broker

RE/MAX West Realty Inc. Brokerage

Independently owned and operated

96 Rexdale Blvd. , Toronto Ontario,

Phone: 416-745-2300

BRMadigan@Rogers.com

Powered by Lone Wolf Real Estate Technologies (CMS6)