All About Estates

An Inconvenient Truth: Cross-border Estate Barriers for Non-Resident Executors

Today’s blog comes to you from Student-at-Law, Derrick Raphael.

As a new resident of Canada there are several issues that an individual must consider such as tax implications while residing in the country as well as one’s previous jurisdiction. Additional areas of interest regard how to manage assets, property and other investments when an estate needs to be distributed. Personally as a newcomer to Canada I had yet to think about my estate but the discussion of cross-border estate issues should not be put off due to its importance and the ability for proper planning to reduce the stress of future executors and loved ones alike.

With the constant movement of residents from the United States to Canada and vice versa, it is easy for individuals to assume that their interests will be covered by simply appointing close family or friends as the executors of their estates. Unfortunately this belief is frustrated when individuals residing in one jurisdiction desire that their estate will be administered by an executor living in another. This difficulty is further heightened due to the likelihood that the executor may even be recognized by the local jurisdiction but this acknowledgment will not flow to the financial institutions or financial advisors who will be unable to take instructions from a non-resident due to regulatory barriers.

Although this issue may be more common for the families of Canadians who move to the United States to live and retire “snowbirds,” there are growing numbers of Americans who are relocating to Canada to live and work who will encounter such difficulties concerning the administration of their estates by executors living in the United States. Despite these difficulties there are potential remedies. One of the primary ways a Canadian executor can protect the interests of the estate of an individual residing in another jurisdiction such as the United States, is to retain the services of an investment advisor who has a license to practice in Canada and the United States. Although this is likely the most simple way to ensure that the estate can be managed it is not the only option available. If there is a reliable U.S. resident available for appointment to manage the estate instead, then that is another possibility for Canadians seeking to manage the affairs of family or friends who reside south of the border.

These challenges are avoidable if proper estate planning is engaged in by thinking ahead to address any and all complications which may occur when an appointed executor may reside in a different jurisdiction from the testator. Such problems are most common when the executor and beneficiaries reside in different jurisdictions. Despite the “inconvenient truth” of the likely difficulties to encounter executors who reside in a different jurisdiction from the testator, a positive conclusion can be insured through prudent estate planning.

About Brittany Sud
Brittany Sud is a member of the Trust, Wills, Estates and Charities Group at Fasken, Toronto office. Brittany is developing a broad estates and trusts practice with a focus on planning and administration matters. As part of her practice, Brittany assists high net worth clients, entrepreneurs and professionals with Wills, powers of attorney, domestic contracts and trusts. She has experience developing and implementing cohesive estate plans that reflect the financial objectives and short and long-term goals of clients, including advising on probate planning, family business succession planning, asset protection strategies and disability planning. Brittany’s estate administration practice includes preparing applications for probate and administering the Canadian estates of non-residents. Outside of the office, Brittany enjoys playing softball and tennis, travelling and cooking. She is a dedicated volunteer of the United Jewish Appeal, Jewish National Fund, One Family Fund and Baycrest Foundation. Community Involvement • Host, Baycrest Foundation - Game Night for Baycrest, 2015 • Chair, Pitch for Israel Softball Tournament, 2014-2016 • Vice-Chair, United Jewish Appeal Young Lawyers Leadership Campaign Canvassing Team, 2016 Memberships and Affiliations • Member, Canadian Bar Association • Member, Ontario Bar Association - Trusts and Estates Law Section • Member, Ontario Bar Association - Young Lawyers’ Division • Student Member, Society of Trusts and Estates Practitioners (STEP) Canada

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