# Death in the Family



## Money4life (May 17, 2012)

Hello,

My father-in-law passed away last week and I have some questions about his estate. His main assets are bank accounts and a car. He has zero liabilities--no mortgage (sold his property a few years ago), no loans (paid off his car in full) and no credit card debt. I've read that we're supposed to open an estate's bank account; is this true even though he possesses no debt? Do we have to close his non-registered accounts and move those assets to his estate's account? What will happen to his RRIF and TFSA accounts? How/when will they get "rolled-over" to his spouse (beneficiary's) account?

According to his will, all of his assets are supposed to go to his spouse, which is the same person as the executor. So will we only need a Will and Death Certificate at hand to sort out his bank assets? As for his car, it is only registered under his name; how do we go about getting the ownership transferred now that he's deceased? Ditto for his car insurance; he was the primary driver and her daughter is one of the secondary drivers (with me).

Sorry, this is all new to me.

thanks!


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## AltaRed (Jun 8, 2009)

An estate bank account "Estate of John Doe" is what is set up to handle his estate's expenses, e.g. cost of accountant, legal, funeral home, CRA income taxes on Final T1 Return. So it is 'most likely' a good idea to set one up for the Executor to pay creditors from. Otherwise, the Executor will have to pay bills from the Executor's own account. The Estate account can be closed after the estate is probated and settled.

A lot depends on how much of his assets were held JTWROS with his spouse. If much of it is JTWROS, then it is a matter of taking an original copy of the Statement of Death (get several of these from the funeral home - and these are much quicker to use than a formal Death Certificate from the provincial government) and a copy of the Will (to confirm who is Executor) and "perhaps"a signed Letter of Direction to each FI and have the accounts converted (transferred) to spouse only account. Sometimes FI's will allow the same account number to stand. A Letter of Direction may not be required for any of the JTWROS accounts - the Executor should simply verbally ask the FI and if they need one, most will already have a 'template' letter for the Executor to use. That is the easy part.

For individual accounts not jointly held (bank accounts and non-registered investment accounts), they will have to go through Probate first before they can be 'disbursed' to the beneficiary. Once Probate has been obtained, the Executor can send a Letter of Direction (likely based on templates provided by the FI) requesting disbursement of the proceeds to: 1) the Estate bank account in cash, or 2) rollover to the beneficiary in cash or in kind, or 3) some combination.... remembering that some money needs to be held in the Estate bank account to pay CRA income taxes for the Final T1 return. Remember a tax free rollover can be made to the surviving spouse so that there is no crystallization of cap gains (the ACB of the investments follows the investments to the surviving spouse).

If the RRIF and/or the TFSA had designated beneficaries, these accounts can be rolled over to the spouse and done pre-Probate, i.e. immediately (means a month or so due to paperwork). TFSA's also can have what is a sucessor holder - find out which it is from the FI as that will depend on how it is rolled over (the successor designation allows unused contribution room to rollover to the spouse I believe). 

With the vehicle, the Executor will have go to the Registry for the province with a copy of the Statement of Death and likely a notarized (or true copy) of the Will to have registration changed to the beneficiary. Registry may, or may not, need a Letter of Direction. Google for your province. The auto insurance can be cancelled and balance refunded made out to the Estate of John Doe (again with copy of the Statement of Death and maybe a copy of the Will) and the new owner will have to insure the vehicle.

Google up 'duties of an Executor' and you will get a number of PDF guides to help you through this. RBC Royal Bank has one of the best around (that I know of and used last year with my mother's death) and it provides step by step things to think of and do.

Added: Be sure to let Service Canada know right away about CPP and OAS so that OAS payments stop at the end of the month of death and last CPP payment is made at the end of the month of death and any application for CPP Survivor's benefit can be made. The Executor should inform the CRA of the death with a copy of the Statement of Death and a true copy of the Will as well. That is so CRA can start sending notices pertaining to the Estate of John Doe to the Executor.


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## birdman (Feb 12, 2013)

I'm certainly not an expert on the subject but will attempt to explain a few things. In regards to the bank accounts, if they are in his name alone the accounts are for the most part frozen as he is no longer around. The are accounts are renamed as "The estate of . . . . . . .". In due course the executor of the estate provides a copy of the will which names the executor along with a copy of the death certificate. After the F/I receives these they will permit some payments from the account, for example funeral expenses. These would be paid by the executor (the deceased wife) and she would sign the cheques with her signature and then add "Executor for the estate of . . . . .". After this the funds stay in the account until the F/I agrees to release them and this decision depends on whether or not the will needs to be probated. F/I's have certain requirements for probate. If it is a smaller amount they will release the funds to the sole beneficiary of the estate but if it is larger it will have to be probated. However, if the account was in joint names "with right of survivorship" the funds automatically transfer to the other person who appears on the account.
The F/I will help you with the RSP's and all accounts for that matter and that is the first step. The motor vehicle office will guide you through the transfer of ownership of the car but I expect it will be similar to the F/I's. Thats it for now.


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## carverman (Nov 8, 2010)

AltaRed said:


> An estate bank account "Estate of John Doe" is what is set up to handle his estate's expenses, e.g. cost of accountant, legal, funeral home, CRA income taxes on Final T1 Return. So it is 'most likely' a good idea to set one up for the Executor to pay creditors from. Otherwise, the Executor will have to pay bills from the Executor's own account. The Estate account can be closed after the estate is probated and settled.
> 
> A lot depends on how much of his assets were held *JTWROS with his spouse*. If much of it is JTWROS, then it is a matter of taking an original copy of the Statement of Death (get several of these from the funeral home - and these are much quicker to use than a formal Death Certificate from the provincial government) and a copy of the Will (to confirm who is Executor) and "perhaps"a signed Letter of Direction to each FI and have the accounts converted (transferred) to spouse only account. Sometimes FI's will allow the same account number to stand. A Letter of Direction may not be required for any of the JTWROS accounts - the Executor should simply verbally ask the FI and if they need one, most will already have a 'template' letter for the Executor to use. That is the easy part.



The use of acronyms applies even to the moment of death. :biggrin:
Joint tenants with right of survivorship (JTWROS) is a type of ownership in which all joint owners have equal portions of ownership that are immediately allocated to remaining owners if one owner dies.

Not just Financial Institutions......
My understanding from the funeral home which will handle me, is that the coroner only issues one copy of the death certificate. The other copies will be needed by CRA, Pension funds, Ministry of Transport to cancel driver's license, Ministry of Health (OHIP in Ontario) also require proof of death before cancellation of credential documents. Not sure about Passports, but I'm sure it's probably a requirement as well.

Most funeral homes can issue up to 10 copies of the *Proof of death certificate*.

*however:*


> *Proof of Death Certificate* is not sufficient documentation to meet the requirements of some life insurance companies, financial matters in other countries or if the body is being shipped outside the country.


for more info: 
http://www.hodgesfuneralhome.ca/-14524.html

However, some FI require a certified copy..like a pension plan 


> In these situations a *Certified Copy of the Death Certificate* is required. A copy of this document must be ordered from the Office of the Registrar General of Ontario


https://www.ontario.ca/page/how-get-copy-ontario-death-certificate-online


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## OhGreatGuru (May 24, 2009)

It depends on the financial institutions involved, and the nature of the estate assets involved. Go and talk to them in detail.

If the registered accounts (TFSA and RRIF) have the spouse as named beneficiary/sucessor account holder, these pass outside of the estate, and the bank will transfer them without probate.

If the non-registered accounts are not JWROS, it is likely the bank will require a probated will; and an estate account to which the proceeds of assets of those accounts are transferred.

JWROS accounts and assets pass outside of the estate, and normally the bank will arrange for this on simple presentation of a copy of the Funeral homes statement of Death. - I suggest you get 20 copies - there are lots of people who will want copies.

A further complication is that some cheques may arrive made out to "Estate of" the deceased (CPP death benefit for example. The bank may require opening an estate account to cash these. Talk to them. They have some discretion for small amounts, and/or where the survivor is the spouse.


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## AltaRed (Jun 8, 2009)

Caverman, a technicality nit pick but JTWROS results in undivided interest, not necessarily equal interest. Only the co-owners know what portion each 'owns'. On paper, the assumption would be equal interest.

Funeral home Statements of Death are good enough for everything I used them for in my Mother's estate. That included banks, discount brokers, life insurance companies, CRA, CPP, cancellation of health insurance, drivers license, etc. 

Actual death certificates can take months to come from provincial ministries, such as Vital Statistics in AB. Avoid having to use actual death certificates if possible.


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## marina628 (Dec 14, 2010)

I will share my experience with my brother who left me his only beneficiary and executor of his estate.He knew he was dying so before his death he gave money to others he wanted to care for to make his passing easier in the business sense.I never had to open an estate account as he banked with TD and we had a joint bank acct .The $2500 CPP death benefit cheque they deposited into our joint bank acct even though it said estate of my brother and my name under it .I had to claim this $2500 on my personal income taxes.So if his spouse is only beneficiary and they had joint accounts this should be relatively easy process especially if no debts.My brother had a small RSP (less than $3000)and I was listed as beneficiary so with producing the death certificate and his will this was collapsed and a bank draft was given to me minus appropriate income taxes.


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## carverman (Nov 8, 2010)

AltaRed said:


> Funeral home Statements of Death are good enough for everything I used them for in my Mother's estate. That included banks, discount brokers, life insurance companies, CRA, CPP, cancellation of health insurance, drivers license, etc.
> 
> Actual death certificates can take months to come from provincial ministries, such as Vital Statistics in AB. Avoid having to use actual death certificates if possible.


Good to know. I would hate to have my estate having to pay the Ministry of Records, $15 per officiial copy of my death certificate. 
That is like the ministry reaching iinto the grave (after paying HST already) and picking my "symbolic pockets" at that point.


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## carverman (Nov 8, 2010)

OhGreatGuru said:


> If the non-registered accounts are not JWROS, it is likely the bank will require a probated will; and an estate account to which the proceeds of assets of those accounts are transferred.
> 
> JWROS accounts and assets pass outside of the estate, and normally the bank will arrange for this on simple presentation of a copy of the Funeral homes statement of Death. - I suggest you get 20 copies - there are lots of people who will want copies.
> 
> A further complication is that some cheques may arrive made out to "Estate of" the deceased (CPP death benefit for example. *The bank may require opening an estate account to cash these. *Talk to them. They have some discretion for small amounts, and/or where the survivor is the spouse.


This sounds similar to individuals that don't have a spouse. Wouldn't the CPP death benefit be paid to the executor?


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## OhGreatGuru (May 24, 2009)

Yes and no. They aren't made out to the executor personally. Cheques for such things as CPP death benefit; insurance for which there is no designated beneficiary; are made out to "the Estate of John Doe". The executor is the person who is authorized to deposit these in an estate account.


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## AltaRed (Jun 8, 2009)

As alluded to earlier, banks will sometimes make some exceptions for small accounts, such as need or not for estate accounts and/or waiting until probate for distribution. It comes down to the banking relationship and how little exposure there is for the bank if something went off the rails.


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## carverman (Nov 8, 2010)

AltaRed said:


> As alluded to earlier, banks will sometimes make some exceptions for small accounts, such as need or not for estate accounts and/or waiting until probate for distribution. *It comes down to the banking relationship and how little exposure there is for the bank if something went off the rails*.


Good luck with the virtual banks (tangerine/PCF) when it comes to banking relationships. They will follow the letter for their fine print
rules on they will do with your account with them.


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## AltaRed (Jun 8, 2009)

Sure, but that is why there is value in having a relationship with a local bank branch. Makes the life of an Executor somewhat easier. I can see a time coming when people will refuse being an executor. It is a thankless job, and as many would say.... "What did I do that caused you to want to punish me so much?"


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## OhGreatGuru (May 24, 2009)

AltaRed said:


> ...Google up 'duties of an Executor' and you will get a number of PDF guides to help you through this. RBC Royal Bank has one of the best around (that I know of and used last year with my mother's death) and it provides step by step things to think of and do.


Also google up CRA 'What to Do When Someone has Died: http://www.cra-arc.gc.ca/tx/ndvdls/lf-vnts/dth/menu-eng.html
Guide T4011; Preparing Returns for a Deceased Person: http://www.cra-arc.gc.ca/E/pub/tg/t4011/README.html
and: T4013 - T3 Trust Guide http://www.cra-arc.gc.ca/E/pub/tg/t4013/README.html

The Trust Guide is a bit intimidating, because it applies to all kinds of trusts generally. But if you read through it carefully there are only certain parts that apply to a typical Estate Return.

The grossly misnamed Final Return is an income tax return for the deceased up to the date of death. Most income received after the DoD is income to the Estate, and Estate Returns have to be filed for it by the Executor until the estate has been disbursed. The guides will contain directions on what types of income have to be reported on the Final Return vs. Estate Returns.


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