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Estate Return Filing

Distributing a next-of-kin's or friend's estate can take a year or more. Be ready with the Ontario estate information return (EIR) when you need it. EIRs summarize a deceased's assets and their value so estate administration taxes (EAT) can be settled. Axess Law Wills and estate lawyers help ensure your EIR is accurate, complete and on time. We advise you on filing the EIR with the Ontario government and getting on with distributing the estate to beneficiaries. Where large estates are involved, you may want to hold off on distribution until you are completely comfortable all the assets have been claimed. You could wind up being sued or held personally liable if you make a mistake. Axess Law helps you figure out estate trustee responsibilities and legal obligations in Ontario.

What is an Estate Information Return?

When someone asks you to be estate trustee, you make a commitment to distribute their estate and keep accurate records of all your actions. The EIR records assets included in their Will that have gone through probate court before being distributed according to the deceased's wishes in their final Will and testament. You must list all assets that will be used to determine the value of their estate, with details about each and their fair market value. You'll have to act quickly. EIRs are due within 180 calendar days of Ontario probate court approving you as estate trustee. That will require you to get a death certificate, copy of the original Will and any changes and go to court to obtain a certificate of appointment of estate trustee, then submit the EIR.

Filing Ontario Estate Information Returns

Even if an estate is small (under $50,000) and no estate tax is payable, you must still file the EIR on time. Estate information return form 9955e can be submitted online or delivered by hand, mail, courier or fax once you have an estimate of the assets' value. The EIR is completely different from the deceased's final income tax return, which you must also prepare. Axess Law's Ontario virtual Wills and estates lawyers help you understand all of your estate trustee obligations.

Deciding Estate Values for EIRs

Courts don't expect estate trustees to be able to guess what real property, financial assets or personal possessions are worth. Valuations are best done by asking professional appraisers for an asset's fair market value. Appraisal costs can be deducted from the estate proceeds, with whatever is left after professional fees (including your own) going to the beneficiaries. Since it's not unusual for estate trustees to still be collecting and valuing assets before the EIR deadline is up, simply estimate their value and complete the estate information return online submission. Attach an inventory and file an amended return if other assets are located later on. You must report the new assets within six months of their discovery.

What to Include in an EIR

Estate assets you should report in the EIR include:

  • Ontario real estate
  • bank accounts and investments
  • vehicles and vessels
  • property held in others' names, such as real property held as tenants in common
  • business interests
  • copyrights, patents or trademarks
  • household goods
  • or life insurance where the estate is beneficiary.

Report assets located anywhere in the world.

You can exclude:

  • properties owned as joint tenants with other owners, such as spouse or adult child with a right of survivorship
  • assets in secondary Wills that pass outside the estate, such as life insurance policies
  • or assets with named beneficiaries other than "estate" -- typically RRSPS, TFSAs and other investments.

Mortgages and home owner credit lines secured by a mortgage can be deducted from an estate's value, but not other debts such as car loans or credit cards. Be wary if adult children hold assets jointly with parents. The assets may be subject to tax if a court rules they were meant to be included in the estate.

The online estate information return Ontario guide has useful tips on what assets to include. Check it out at www.forms.ssb.gov.on.ca.

How to Amend an EIR

You can correct an inaccurate or incomplete return within four years, as long as you submit the information within 30 calendar days of discovering an error. Just complete a revised EIR and submit it the same way you did the original. If you underestimated the estates' value, you must submit an amended EIR within 60 calendar days of receiving the new valuation. If more than four years has passed, write to the Ministry of Finance with the updated information. Assets that have appreciated since your first estimate do not affect the estate, since taxes are based on their value on the day the deceased died.

Penalties for Fraud or Neglect

Staying on top of your legal duties as estate trustee is important, since not completing an EIR could get you in trouble. The Ontario Ministry of Finance may audit estate taxes after you submit an EIR. If you are reckless or neglectful in how you report assets, fail to file a return, commit fraud or leave out information, the taxes may be reassessed. Estate trustees can be fined from $1,000 to twice the amount of estate tax payable and / or be sentenced to up to two years in prison for misrepresenting an estate's value.

Affordable Rates for Wills and Estates Legal Advice

Axess Law charges affordable rates for legal services. Ask us if you need assistance preparing an EIR or are being audited by the Ontario Ministry of Finance. We take the complexity out of meeting strict deadlines for compliance with court undertakings and submitting information to the Ministry of Finance. Our Ontario Wills and estates lawyers are located in communities near you and we can video conference with you anywhere in Ontario.

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