Working Group - Question 18 - Inter-familial Transfers

As a matter of course, do you recommend inter-familial transfers for the avoidance of probate tax?

Yes
Sometimes
No

What are the risks of inter-familial transfers?

Bankruptcy
Fraudulent conveyance
Spousal rights
Tax issues (capital gains, land transfer tax, HST)
Potential mortgage default
Potential to not avoid the EAT
Potential non-resident issues if the new title holder goes abroad
Severance of a joint tenancy
Depletion of assets a problem for ongoing care for parent
Interference with testamentary gifts already in place
Are there NRST implications?
Potential claims against new title owner (writ, litigation, bankruptcy, marriage issues, etc.)

Do you act for both parties in an inter-familial transfer?

Yes
No

When do you need to recommend ILA/ILR?

When you have represented one of the clients before
Imbalance of power between the parties
To protect yourself
Concerns about ongoing care for the parent (i.e. ask about other assets)
Any kind of other conflict arises

What documents do you use to confirm advice?

Email
Letter
Report
Acknowledgement and waiver
ILA/ILR certificate
Note to file
Recorded video

What advice do you give about the Estate Administration Tax (EAT) avoidance?

The title transfers avoids EAT
The title transfer only avoids EAT if the property is the only asset in the estate if it were probated today
EAT rules may change by the time the transferor dies
The title transfer does not avoid requirement for EAT
Other, please explain.

If the clients are insistent on the title transfer, how do you protect yourself?

ILA/ILR
Trust agreement
Deed of gift
Do nothing
Other: please explain

What steps do you take to ensure that the transferor is protected?

Duress assessment
Capacity assessment
ILA/ILR
In-person meeting
Trust agreement
Other: please explain

For inter-spousal transfers, can you act for both spouses on a title transfer taking off a spouse?

Yes
Yes, if there is no conflict
No

Can you act for both spouses on a title transfer where the spouse staying on title is refinancing their mortgage?

Yes
Yes, if there is no conflict
No

Can you act for both spouses on a title transfer where the party maintaining the property is adding a parent for mortgage qualification purposes

Yes
Yes, if there is no conflict
No

Can you act for both spouses on a title transfer adding a party

Yes
Yes, if there is no conflict
No

What advice do you provide to a party adding a spouse to title

Recommend family law advice
Recommend separate lawyers for the transaction
Advise about the possibility of a severance of joint tenancy, if applicable
Implications of bankruptcy
Implications of fraudulent conveyance, if applicable
Potential mortgage consequences
Tax consequences
Interference with estate planning already in place

Can you remove a spouse from title without a separation agreement?

Yes
Depends on the circumstances
No

Can you act for both spouses if there’s an allegation of domestic violence?

Yes
Depends on the circumstances
No

If there is a mortgage on title, do you advise the financial institution of the change in ownership?

Yes
Only if you acted for the financial institution when the mortgage was registered
No
Other, please explain

Powered by SimpleSurvey