Mickey Rooney’s Estate and Shedding Light on Financial Elder Abuse


Written on April 11, 2014 – 8:55 am | by Diane Vieira

It is not surprising that Mickey Rooney’s estate may become embroiled in litigation.  Mr. Rooney was married nine times; he was survived by a number of children and stepchildren, and was estranged from his current wife at the time of his death.  Such full lives often lead to complicated estates.

More troubling was that shortly before his death, Mr. Rooney spoke about being a victim of elder abuse (both verbally and financially) perpetuated by his stepson.  In 2011, Mr. Rooney delivered emotional testimony before the United States Senate about the fear he felt when his stepson, who managed his finances, would lash out at him when he asked questions about missing money or mismanaged investments.  Shortly before his death, Mr. Rooney (through a conservatorship) had reached a settlement with his stepson that involved his stepson paying back over 2 million dollars for misappropriated funds.  It is not known if his estate will now receive any of these funds.

Mr. Rooney, who worked for over 80 years, left an estate valued at just $18,000.00.  He wisely appointed a neutral party, his conservatorship lawyer, as the executor of the estate.  However, the modest nature of his estate does not mean it will remain litigation free. There are already rumblings about a family dispute as where to bury Mr. Rooney.

On the issue of financial elder abuse, a few days ago, the Canadian federal government tabled new legislation, the Digital Privacy Act. One of the goals of the new legislation is to protect seniors from fraud and financial abuse.  The new legislation will allow financial institutions to notify officials or a next of kin if they suspect that an elderly client is the victim of financial abuse.  Currently, bank officials need to obtain the consent of their client before disclosing information to a third party or to continue investigating the matter.

It is too early to predict whether the proposed legislation will have the intended effect. Obviously privacy issues are a great concern.  However, the government is attempting to address the growing fear of financial abuse among Canada’s aging population.

Thanks for reading,

Diane Vieira

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    Loss Trading – Rules for Trusts


    Written on April 11, 2014 – 7:00 am | by Derek de Gannes

    Currently, loss streaming rules generally apply to limit a corporation’s trading of certain tax attributes (for example, non-capital losses, net capital losses, farm losses, and unused investment tax credits) where a person or group of persons acquires control of the corporation. Begin in 2013 (with transactions after March 20, 2013), similar loss-streaming rules had application to trusts.

    A trust will be subject to a loss restriction event when a person or partnership becomes a majority-interest beneficiary of the trust or a group becomes a majority-interest group of beneficiaries of the trust. The concepts of majority-interest beneficiary and majority-interest group of beneficiaries will apply as they do under the existing income tax rules for affiliated persons. In general, under the affiliated persons provisions, a majority-interest beneficiary of a trust is a beneficiary who, together with persons and partnerships with which the beneficiary is affiliated, has a beneficial interest in the trust’s income or capital with a fair market value that exceeds 50 per cent of the fair market value of all the beneficial interests in income or capital, respectively, in the trust.

    Unless specifically excluded by one of the exempting rules, every change in the beneficiaries of a trust or the trust terms that results in a person becoming a majority-interest beneficiary of the trust may result in a loss restriction event for the trust which, in turn, will result in restrictions on the ability of the trust to use its losses and other tax attributes.

    Speak to your tax advisor and stay clear of theses restrictions.

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      Charities and Changes


      Written on April 9, 2014 – 8:47 am | by Laura West

      I am writing this blog from Vancouver where I am attending the 21st annual conference of the Canadian Association of Gift Planners, which is attended by gift planners, advisors and others working in the field of charitable planned giving. I thought that given my location, it would make sense to write about a topic related to the charitable sector, and in this regard, I thought that I would highlight another charitable sector proposal that was introduced as part of the 2014 federal budget.

      Budget 2014 proposed providing funding to the Canada Revenue Agency to allow it to modernize its technical systems so as to provide charities with new electronic service options. The proposed funding totals $23 million, to be provided over a five-year period beginning in 2014. Budget 2014 also expressed support for the Canada Revenue Agency’s plans to improve its website to provide better access to data on charitable giving trends in Canada.

      The overhaul of the Canada Revenue Agency’s technical systems will allow charities to apply for registration and file their annual information returns online, which will be a welcome change for both charities and their advisors. Hopefully this change will help to simplify the registration process and allow charities to more easily meet their annual compliance obligations.

      Although this is perhaps not the most significant change introduced by Budget 2014 for charities, when the electronic service options are eventually introduced, they will streamline the ongoing administrative dealings that charities and their advisors have with the Canada Revenue Agency.

      Thanks
      Laura West

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