Things To Consider When Selling Corporate Assets

An incorporated business can be sold in two ways: through a sale of shares, or a sale of corporate assets. Corporate assets can be sold piecemeal, which means that it is possible to sell a single asset owned by a corporation while maintaining the corporation as a going concern.

A sale of corporate assets raises a distinct set of legal issues as compared to a sale of shares. Our Edmonton corporate and commercial lawyers can tell you more about what to consider when selling corporate assets.

Do You Have the Authority to Sell Corporate Assets?

Generally, the director or directors of a corporation have the authority to make decisions relating to the running of the corporation, including the sale of an asset. Alberta's Business Corporations Act provides that a sale of all or substantially all of the assets of the corporation:

• - Requires the approval of the shareholders, and
• - Triggers the right of dissenting shareholders to be paid fair market value for their shares.

This requirement can make it difficult or impractical to sell corporate assets, unless the assets belong to a small privately held corporation. This requirement can be particularly problematic when either the seller or the potential buyer of the asset needs the sale to complete by a particular date. Our Edmonton corporate and commercial lawyers keep abreast of current corporate law issues, and may be able to clarify the demands of your specific circumstances.

Is Your Minute Book Up to Date?

An Alberta corporation is required to maintain certain records. Collectively, these records are known as the corporate minute book. When negotiating or finalizing a sale of corporate assets, lawyers and accountants for the purchaser will want to look at the records to make sure that the sale can proceed as negotiated.

Your corporate minute book should include:

• - The articles of incorporation.
• - A register setting out the directors and officers of the corporation.
• - By-laws and any amendments to the by-laws.
• - Shareholder resolutions and the minutes from annual shareholder meetings.
• - Records setting out the issuance and transfer of shares and any changes that have been made to the corporate share structure.
• - Any shareholder agreements.
• - Details of dividends paid to shareholders or bonuses paid to officers.

Missing documents in your minute book can lead to expensive delays.

Tax Considerations

One of the prime considerations when deciding whether to sell a business, whether through a sale of shares or a sale of assets, is the various tax repercussions incurred through each approach. Your concerns with respect to taxes may vary depending on:

• - Whether or not the corporation is a small, privately-held corporation with only one or two shareholders, and
• - Whether or not you intend to sell all the corporate assets.

When a person sells an asset, they incur capital gains, which are taxed at a rate determined by the federal government as part of the person's income for that year. An individual (not a corporation) can take advantage of a lifetime capital gains exemption when disposing of the shares of a qualified small business. If the corporation sells the business assets directly, then that exemption is lost. This is generally more of a concern for individuals interested in selling their entire business, and should be taken into account when negotiating a purchase price for the sale of all or substantially all of the assets of a corporation.

Contact Our Edmonton Corporate and Commercial Lawyers Today for a Consultation

There are many things to consider when organizing the sale of your incorporated business. The process of selling corporate assets, whether piecemeal or not, can benefit from the advice and assistance of a professional Edmonton corporate and commercial lawyer. To address any questions you may have concerning the sale of corporate assets, or any other matter of business law, contact us today to book a consultation.

*Please note that the information in this article is not legal advice, but rather a general overview on a legal topic pertaining to Edmonton corporate and commercial law. For legal advice, please consult with a lawyer.

How Will Insurance Be Impacted By A Motor Vehicle Accident

In Alberta, every owner of a vehicle must have basic automobile insurance, which covers accident benefits and any damage to other people or their property arising from an accident that you are responsible for causing. Optional collision or comprehensive coverage is available in addition to basic coverage. This optional coverage would cover your own damages in the event you are at fault for an accident. The Automobile Insurance Rate Board regulates insurance rates in the province in an attempt to ensure rates remain affordable for Albertans. However, a motor vehicle accident can have an impact on your insurance premium. If you have questions about how your insurance will be impacted by a motor vehicle accident, our Edmonton Section B Benefits personal injury lawyers may be able to help.

Will an Accident Affect My Insurance Premium?

If you were responsible for causing a car accident, this will be reflected by an increase to your automobile insurance premium. An "at-fault" collision will also be added to your driving record and will remain there for six years. Typically, changing insurers has little effect on the increase in insurance premiums due to an at-fault accident.

When determining your premium, an insurance company will use your driving record to try to determine how much of a risk you pose. A driver with an at-fault accident on their record poses a greater risk to the insurance company, and will have a higher rate. In addition to the risk factor, an insurance company may impose a surcharge due to an at-fault accident. This means a single accident may affect your insurance premium twice.

An accident is not the only factor that effects change in insurance premiums. Speeding tickets and the driving records of other drivers associated with your insurance (such as your spouse or children) may also be affecting your premium, as will the amount of driving you do and the make, model and year of your vehicle.

How is fault determined after a motor vehicle accident?

The person responsible for causing a motor vehicle accident is determined primarily by the insurance companies involved in the claim. The police do not make the determination, and even if the police file criminal charges, this will not necessarily be determinative of liability from an insurance perspective. If necessary, it is possible for an insured to challenge a determination of fault in court.

Recent changes to the Insurance Act

Recent changes to Alberta's Insurance Act mean that you now deal with your own insurance company with respect to property damage claims. This system is called direct compensation for property damage or DCPD. The goal of DCPD is to keep insurance premiums low by reducing expenses for insurance companies caused by litigation in relation to property damage.

DCPD relates to claims for property damage only. A person injured in a motor vehicle accident can still sue an at-fault driver for the damages related to their injuries. Contact a personal injury lawyer for help with any insurance or personal injury matters connected to a motor vehicle accident.

Contact Our Edmonton Section B Benefits Personal Injury Lawyers Today for a Consultation

Under the new DCPD system, at-fault drivers are still held accountable by having their insurance premiums increased, and at-fault collisions are still added to a driver's driving record. This can be a complicated system to navigate. You do not have to do it alone. Contact us today with any questions, and for more information on how your insurance may be impacted by a motor vehicle accident.

*Please note that this article is a general introductory overview on a legal subject, and is not intended as legal advice. For legal advice, contact our Edmonton Section B Benefits personal injury lawyers.

The Benefits Of Hiring A Divorce Lawyer In Alberta

Some people have the impression that by hiring divorce lawyers, you and your spouse are committing to going to court to resolve the issues arising from your divorce. This couldn't be further from the truth. Your divorce lawyer can help you resolve your family issues in the most expedient way possible. By deciding not to hire a divorce lawyer, you may just be deciding not to deal with your problems – or delaying a resolution. Such delays can have a negative effect on your entire family. Contact our Edmonton family law lawyers to find out the benefits of hiring a divorce lawyer in Alberta in your specific situation.

What Services Can Your Divorce Lawyer Provide?

Your divorce lawyer can help by providing services before, during and after your separation. They can help you move forward after your separation or they can help you to make changes to an agreement that has been in place between you and your ex-spouse for years. Your divorce lawyer is equally comfortable negotiating a solution to a problem as they are making an application to the court.

Typical areas of law that your divorce lawyer deals include:

• - Child guardianship and parenting orders
• - Child support and spousal support
• - Family property division.

What Are the Benefits of Hiring a Divorce Lawyer in Alberta?

Your divorce lawyer can make the divorce process less stressful and more efficient by:

• - Ensuring that any agreements are properly documented so that they can be enforced if This includes ensuring that your spouse obtains independent legal advice, which will reduce the likelihood that a court will determine the agreement was unfair.
• - Keep the emotions out of negotiations. Your divorce lawyer is a professional. This divorce is personal for you. Having the assistance of an objective voice of reason during negotiations can prevent negotiations from getting off track.
• - Some ex-spouses benefit from not dealing with each other directly, especially immediately after a separation. This can be especially important where the ex-spouses need to collaborate on making a parenting plan for children they share. Your divorce lawyer can deal with the conflict so that you and your ex-spouse can learn to work together again.
• - Your divorce lawyer knows the law and they will use that knowledge to protect your rights and those of your family - in particular, your children.
• - Some people without legal representation put off dealing with their divorce because they simply don't know how to proceed. Your divorce lawyer wants you to have a final resolution of your problems. They will not allow things to drag on any longer than necessary.
• - Your divorce lawyer knows the best way to proceed to achieve your desired goals. They can provide you with knowledgeable advice and follow through to get things done.

Contact Our Edmonton Family Law Lawyers Today for a Consultation

Divorce is often a highly emotional process that can feel overwhelming to all parties involved. When you work with a divorce lawyer, you have a professional to help ensure your divorce moves forward in a timely manner, and any arising issues are dealt with as inexpensively, quickly, and efficiently as possible. Our Edmonton family lawyers take your specific circumstances into account and strive to minimize the stress of the entire process. If you have any questions or would like to book a consultation, contact us today.

*Please be advised that this article is a general overview on a legal topic concerning family law, and does not constitute legal advice. For legal advice, contact an Edmonton family law lawyer today.

Tips For Dealing With Debt During A Divorce

In Alberta, the Family Property Act governs the division of the property (and debts) acquired by a couple during their marriage. This regime applies to both secured debt, such as a mortgage or a vehicle loan, and unsecured debt, such as that associated with credit cards. It applies both to debt in joint names and debt in the name of one spouse alone. For more information on dealing with debt during a divorce, contact our Edmonton family lawyers.

How Are Debts Treated During a Divorce?

In general, assets and debts acquired by the couple during their marriage are divided equally by the parties. Each party will add up the value of their respective assets and debts and the spouse with the larger sum will be required to make an equalization payment to the other spouse.

Certain assets are excluded from division, such as gifts from third parties and inheritances. A debt acquired by one party prior to the beginning of the marriage may be excluded from property division, depending on the circumstances.

Division of assets and debts can be affected by agreement between the spouses or by Court order in cases where the spouses cannot agree. If done by agreement, the parties can choose whichever date makes the most sense to value their assets and debts. The Court typically divides assets and debts as of the date of trial. However, in circumstances where one party has taken on debt for personal reasons after the separation and before the trial, that amount will typically not be divided equally between the parties.

Your Creditors Do Not Care About Your Divorce

The creditor or lender will seek payment for debts from the person or persons who owe the debt. If your name is attached to a loan or credit card as a borrower, the creditor can seek payment for the full amount of the loan for you, regardless of whether your ex-spouse may ultimately be responsible for half of the amount.

Tips for Managing Debt After Separation

The following tips can help you prepare for a divorce and make it through without drowning in debt:

• - Don't put off dealing with the division of assets and debts! There are limitation periods to worry about (after a certain length of time, you may no longer have a claim for an equalization payment from your spouse). Also, the more time that passes, the more complicated it can be to assign fair values to all of your assets and debts.
• - Get a new credit card. If you and your spouse have a joint credit card, you and your spouse should cancel it and obtain separate cards. If your spouse is an authorized user on your card, you will need to remove them.
• - Similarly, consider whether any debt in joint names can be increased unilaterally by one spouse after the separation and take steps, if necessary, to prevent that from happening.
• - Keep track of debt accrued after the separation, and what the funds were used for.
• - Keep in mind that it may not be possible to extricate your finances from those of your spouse immediately following your separation.

Contact Our Edmonton Family Lawyers Today for a Consultation

Divorce can be challenging enough without the additional financial and emotional stress of dealing with the division of debt. Ideally, both parties would collaborate on a mutually satisfactory solution, but it can often happen that one ex-spouse may leave the pressure of their debts on the other. Whatever your specific circumstances, our Edmonton family lawyers are ready to answer your questions and see if we might be of help to you. Contact us today and book a consultation to talk through the specifics of your divorce.

*Please note that this article does not constitute legal advice, and is intended as a general overview of a legal topic in the area of family law. For legal advice, contact an Edmonton family law lawyer.

What Families Need To Know When Filing A Wrongful Death Claim

Alberta's Fatal Accidents Act (FAA) applies when a person is killed as a result of a wrongful act, neglect or default of another person, as long as the deceased, had they not died, would have had an action for damages against that person. While no amount of money will successfully compensate for the loss of a family member, the FAA recognizes that the loss of a close family member has financial repercussions that should be addressed when the death was caused by the negligence of another.

Our Edmonton personal injury lawyers may be able to provide you with further information on what families need to know when dealing with a wrongful death claim.

Who Can Make a Wrongful Death Claim?

The FAA sets out specifically which family members can make a wrongful death claim. Benefits under the Act are limited to:

• - The spouse or adult interdependent partner of the deceased - note that this person is only eligible if they were not separated from the deceased at the time of death
• - A parent of the deceased
• - A child of the deceased
• - A brother or sister of the deceased

All wrongful death claims relating to the death of an individual must be brought in one action. Typically, the executor or administrator of the estate will bring the action on behalf of all the affected family members.

What Amounts are Payable Under the FAA?

The FAA provides for the payment of a statutory "bereavement benefit." This benefit is:

• - $82,000 payable to the spouse or adult interdependent partner of the deceased.
• - $82,000 payable to the parent or parents of the deceased (if the action is brought for the benefit of both parents, the bereavement benefit is split equally between the parents).
• - $49,000 for each child of the deceased.

In addition, if a family member was dependent on the deceased person for financial support, then they may have a claim for the loss of that support. If the deceased family member was in charge of looking after the home and minor children, the family members may have a claim in relation to the loss of those services. Additional claims can be brought in relation to:

• - Expenses relating to the care of the deceased between the time of the accident and death
• - Funeral expenses
• - Grief counselling expenses

Additional Considerations if the Deceased Was in a Motor Vehicle Accident

The damages assessed under the FAA do not take into account any amount payable under a contract of insurance such as Section B Benefits. If your family member died in a car accident due to the negligence of another driver, you may be eligible to pursue additional claims through the insurance companies.

Courts in Alberta will consider the fact that a deceased was not wearing a seat belt at the time of the accident causing death when assessing benefits payable to family members under the FAA. If the lack of seat belt is found to be responsible for causing or contributing to the death of the deceased person, this may affect the family's claim for benefits.

Contact Our Edmonton Personal Injury Lawyers Today for a Consultation

In the aftermath of losing a loved one as a result of another person's wrongful actions, negligence, or defaults, there may be many things for surviving family members to navigate. Matters concerning a wrongful death claim may feel overwhelming. Let our Edmonton personal injury lawyers help. For assistance with any questions concerning a wrongful death claim in Alberta, or to address the specific needs of your case, contact us today and schedule a consultation.

*Please be advised that the information in this article is not intended as legal advice, but rather serves as an introductory overview on a legal topic. For legal advice, please consult with an Edmonton personal injury lawyer.

No Will? - Alberta Wills And Successions Act Explained

Preparing a will is a task with an unfortunate reputation. People dread doing it. They put it off – sometimes indefinitely. But this reputation is largely unfounded. For many people, preparing a will is a straight-forward and completely painless process, and the benefits of getting it done sooner rather than later are great.

No will? Our Edmonton probates and wills lawyers can explain the Alberta Wills and Succession Act to ensure you have the knowledge you need to protect your family.

How Will Your Estate Be Distributed If You Die Without a Will?

If you die without a will, it is known as dying intestate. The Wills and Succession Act will dictate how your estate is distributed.

If you die intestate and have a spouse or adult interdependent partner, but no descendants, then your entire estate is distributed to your spouse or adult interdependent partner. If you do have descendants, but they are also the descendants of your spouse or adult interdependent partner, then the entire estate is distributed to your spouse or adult interdependent partner.

If you have descendants from a previous relationship, then your spouse will receive the greater of $150,000 or 50% of the net value of your estate, and the remaining share of the estate will be distributed equally among your descendants.

If you have no spouse or adult interdependent partner, your estate will be divided among your descendants. If you have no descendants, then your estate will be divided among your parents, or if there are no surviving parents, any descendants of your parents (siblings or their children). Failing that, your estate will be divided among your grandparents or any descendants of your grandparents (aunts and uncles or their children).

How Does a Will Protect Your Family?

If your estate will be distributed to your family in any event, is a will really that important? Absolutely! Without a will, no one has the authority to deal with the intestate estate. Someone has to apply to the court to be appointed administrator for the estate. The Estate Administration Act sets out who can apply to the court and who will be given preference.

When you write a will, you choose someone to represent your estate by performing the duties of an executor, or personal representative, saving your family the time and money required to have an administrator appointed.

The mechanism for intestate distribution is designed to be generally fair in most situations. That does not mean it will be fair to your family.

For example, the equal distribution of an estate among all four of your children may not be fair if two of those children are independent adults, and two of those children are still dependent on you at the time of your death. This is especially true in the case of a more modest estate.

If you have no family members with whom you are close, you may prefer to distribute your estate to friends or charities rather than have it distributed among second cousins whom you've never met, or to the Government of Alberta.

Contact Our Edmonton Probates and Wills Lawyers Today for a Consultation

Writing a will does not have to be an arduous process, and having one in place can help you and your successors have peace of mind about the future of your estate. If you have any questions about Alberta's Wills and Succession Act, or would like to consult with our probates and wills lawyers about any matter concerning estate law, contact us today.

*Please be advised that the information in this article is not legal advice. For legal advice, please contact an Edmonton probates and wills lawyer.

Registering A Trademark In Alberta

Registering a trademark enables you to protect all the hard work, time and money that you put into developing the reputation of your business and its products or services. Failing to register can mean throwing that work away, as you have no way to stop competitors from using your marks in conjunction with their own business. Protect your business by registering a trademark in Alberta. Book a consultation with our Edmonton Edmonton corporate and commercial lawyers to discuss the details of your situation.

What Is a Trademark and What Does It Accomplish?

A trademark is a combination of elements used to distinguish a business owner's goods or services from those of others. The elements of a trademark can include:

• - Words and letters
• - Designs or images
• - Tastes, textures, sounds and scents
• - Moving images
• - Packaging
• - Holograms
• - 3-dimensional shapes
• - Colours

A trademark does not need to include all of these elements. Many trademarks consist of just a word or just an image or design.

A trademark, when used in combination with your business, becomes known by the public over time and comes to represent both the product or service you provide, and the reputation of your business.

What Are the Risks of Not Registering Your Business or Product Name as a Trademark?

There are many things to consider when starting a business, and trademarking your business or product names may not be at the top of mind. However, if you decide not to register your trademark, you risk others using the same mark in conjunction with their own business. If a competitor uses the same or similar marks in conjunction with their business, the results may be confusing for the public and damaging to your business. Potential customers might go to your competitor, mistakenly thinking they have found you. If your competitor's product or services are inferior to your own, some potential customers, having been disappointed by your competitor in the past, might avoid you in the future thinking you are the same business.

Not only do you risk confusing potential customers and losing business, but if a competitor decides to register the confusing mark, they can then demand that you stop using it – even if you have been using it longer. This can end up costing significant amounts of money in legal fees and expenses for rebranding and redesigning packaging.

How to Go About Registering a Trademark in Alberta

All trademarks in Canada are registered federally with the Canadian Intellectual Property Office. The first step in registering a trademark is ensuring that your mark meets the formal requirements set out in the Trademarks Act. The problem most commonly encountered at this stage is when a mark is found to be confusingly similar to an existing mark. You may need to tweak your mark and your application if you encounter this problem.

You or your trademark agent will submit an application to the Canadian Intellectual Property Office with your application fee. A trademark examiner reviews your application, and if it satisfies the examiner, the application is published in the Trademarks Journal. Others have the opportunity to see your application and oppose it. If your application is not opposed, or if an opposition is withdrawn or not successful, then your trademark is registered. The registration lasts for 10 years and can be renewed at that time.

Contact Our Edmonton Corporate and Commercial Lawyers Today for a Consultation

Registering a trademark to represent your unique business and products can be essential to nurturing and protecting the growth of your company. Opposition during the application process is not the only potential complication while going about registering a trademark. Our Edmonton corporate and commercial lawyers might be essential in addressing your questions and guiding you through the process of registering a trademark in Alberta. Contact us today for more information and to book a consultation.

*Please note that this article is intended to offer a general overview on the topic of registering a trademark in Alberta, and does not constitute legal advice. If you would like legal advice, contact an Edmonton corporate and commercial lawyer today.

Determining How To Divide Assets In A Divorce

The division of assets is often the most technically complex issue that arises when a couple who are married or in an adult interdependent partnership separates or divorces. Even determining how to assign a value to certain assets can be a complicated process. You don't have to figure it out alone! Our Edmonton family law lawyers can answer any questions you have about determining how to divide assets in a divorce.

General Asset Division Regime

The Family Property Act governs the division of assets after the separation of a couple who were married or in an adult interdependent partnership. In general, the value of property that is acquired by a couple during the relationship is divided equally between them. Similarly, they will be equally responsible for debt that is acquired during the relationship.

Some property is exempt from division, including:

• - Gifts received by one party.
• - Inheritances received by one party.
• - Property that one party owned before the beginning of the relationship.
• - Awards from a personal injury claim or insurance proceeds, in some cases.

Some property may be divided unequally, depending on what is considered fair in the circumstances. The most straight-forward example of this is when an asset owned prior to the relationship increases in value during the relationship. This increase in value may be divided equally or unequally, depending on the reasons for its increase, the length of the relationship, the financial circumstances of both parties, or other reasons the court considers relevant.

Prenuptial and Marriage Contracts

If a separating couple has a valid prenuptial or marriage agreement that deals with division of property, the procedure set out in the agreement will govern the division of property after the separation or divorce.

How to Divide Property

The first step is to identify all the property you own. Make a list of any property in your name or in your name jointly with anyone else. Property includes:

• - Real estate
• - Business interests
• - Personal property such as furniture and artwork
• - Bank accounts
• - Investments
• - RRSPs
• - Pensions
• - Vehicles

Don't forget to list your debts as well. Credit card debt, mortgages or lines of credit, and any other loans, should be listed.

The next step is to assign a value to every item on your list. Some assets, such as real property and businesses, may require the assistance of a professional to value. Then, divide the list into property that is to be divided and exempt property. Also make note of any property that you think should not be divided equally.

The last step is to divide the value of the property.

Complications can arise in this process when:

• - Documents required to value property are in the hands of the other party.
• - The parties disagree with respect to the value assigned to property.
• - The parties disagree about which property is exempt or how to divide property that is subject to unequal division.
• - The parties disagree about who will retain certain property, whether it will be sold, or how it will be sold.
• - The parties disagree about whether they have a valid prenuptial or marriage agreement that governs the division of property.

Contact Our Edmonton Family Law Lawyers Today for a Consultation

Separation, including divorce, is often a highly emotional process, and disagreements about the division of assets are common. In situations where the division of property becomes complicated, the help of a family law professional may help to lend clarity to the process. At Verhaeghe Law, our team of dedicated family lawyers would be happy to address any questions you may have. For professional help determining how to divide assets in a divorce, contact us to schedule a consultation today.

*Please be advised, this article does not constitute legal advice, but is intended as a general overview of a legal topic. For legal advice, please contact an Edmonton family lawyer.

Considerations for Divorcees Drafting Wills

In Alberta, divorce automatically revokes any provision in your will that relates to your ex-spouse. As most married people include their spouse as both a beneficiary and an executor in their will, it is vital to update the will after a divorce. Because this automatic revocation does not take effect until your divorce order is issued, you might consider updating your will even earlier, as soon as you separate.

Our Edmonton wills and estates lawyers can provide you with further advice on these considerations for divorcees drafting wills.

What Happens if You Fail to Update Your Will?

It is recommended that you update your will any time there is a major change in your life, because your will may no longer reflect your wishes and intentions for the distribution of your estate. You may also have committed to something in a separation agreement that requires you to make a change to your will.

The Wills and Succession Act ensures that upon divorce, any provision in your will that names your ex-spouse as a beneficiary is revoked. Some people name their spouse's family members as contingent beneficiaries or back-up executors in case their named executor is unable to act. After your divorce, you may wish to change these provisions, depending on your continued relationship with your in-laws.

It is also possible that you still want your ex-spouse to act as your executor, or to be a beneficiary of your will. If so, you must update your will and include a provision that clearly expresses your intention to include your ex-spouse. You can only do this by updating your will after your divorce is granted.

People often move to a new town after a divorce. If you have moved since your divorce, you may want to examine any provisions in your will dealing with funeral arrangements, to be sure they are still appropriate.

Making Provisions for Minor Children

A will generally expresses a parent's wishes for the guardianship of any minor children in the event both parents are killed or are otherwise unable to continue providing care. The provisions that you and your spouse agreed upon during your relationship may no longer be appropriate after your divorce.

If you and your spouse continue to manage an RESP for your children, you may want to ensure that there is a plan in place for the distribution of the RESP if you or your spouse dies prior to its use.

How to Update a Will

You cannot update a will by making handwritten changes on the original document. You can update a will by either:

• - Writing a new will and signing it in front of witnesses, or
• - Writing a codicil, which is a separate document that changes only part of your original will.

A codicil is generally used only if you are making a minor change. Rewriting your will in its entirety is likely necessary after a divorce.

When you update your will, it is a good idea to ensure that named beneficiaries to insurance policies, RRSPs and TFSAs are updated as well.

Contact our Edmonton Wills and Estates Lawyers Today For a Consultation

There can be many details to consider in the writing and rewriting of wills, particularly following a divorce. For more information on these and other concerns you might be facing in a legal separation, contact our Edmonton wills and estates lawyers today!

*Please note, the information in this article does not constitute legal advice, but is intended to offer a general overview on the subject of wills and estates law in Alberta. Please contact a lawyer for legal advice.

The Importance of Determining Cash Needs for the Administration of an Estate

The cash needs of an estate in Alberta are often not as large a concern as they are in jurisdictions that have significant estate taxes. However, even without estate taxes, the administrator of an estate in Alberta is still responsible for paying all debts and bills, including the income tax of the deceased in the year of their death, prior to distributing any assets to the beneficiaries. This can interfere with the intention of a testator to pass specific assets, such as business assets or real property, to their beneficiaries.

Whether you are determining your own estate needs or administering the estate of another, our Edmonton estate administration lawyers can ensure that you understand the importance of determining cash needs for the administration of an estate.

Reasons an Estate May Need Cash

The administrator of an estate cannot distribute the assets of the estate to beneficiaries until they have paid all debts, outstanding bills, and taxes for which the estate is responsible. Depending on the size and nature of the estate, the debts, bills and taxes may or may not be significant.

Typical bills can include:

• - Funeral or burial costs
• - Professional help sought in the administration of the estate (for example, lawyer or accountant's fees)
• - Professional help sought in maintaining assets (for example, fixing the roof or cutting the grass at the testator's home pending its sale or distribution).

Court fees related to a grant of probate in Alberta are set out in the Surrogate Rules and vary according to the net value of Alberta property held by the estate:

• - Where the net value of the estate is $10,000 or under, probate fees are $35
• - Where the estate is valued over $10,000 but not more than $25,000, probate fees are $135
• - Where the net value is over $25,000 but not more than $125,000, probate fees are $275
• - Where the net value is over $125,000 but not more than $250,000, probate fees are $400
• - Where the net value is over $250,000, the probate fees are $525.

Income Taxes

The income taxes of the deceased may be one of the most onerous responsibilities that the administrator has to meet before distributing the remainder of the estate.

Canada does not have an estate or inheritance tax, but it does have deemed disposition rules, which deem that a deceased has disposed of all capital property right before their death. There is a one-time capital gains exemption that may be applicable for many people and can reduce tax liability. However, if the testator has significant assets, the deemed disposition rules can result in a significant income tax bill due to the resulting net capital gains.

Sources of Cash

The administrator can obtain cash to cover these obligations from:

• - An income tax refund
• - Insurance proceeds
• - CPP death benefit
• - Liquid assets.

Where these sources are insufficient, it may be necessary to sell business assets or real property. This often means that either:

• - The testator's intended beneficiaries end up contributing the necessary cash to the estate so they can receive their intended inheritance, or
• - The inheritance is lost to cover the debts of the estate.

Contact our Edmonton Estate Administration Lawyers Today For a Consultation

Our Edmonton estate administration lawyers can help you to determine the cash needs for the estate that you are responsible for administering. Contact us to schedule a consultation today.

*Please be advised that the information in this article is not intended as legal advice, but as a general overview on a legal subject. Please consult with a lawyer if you require legal advice.