Estate planning

Website of law firm that advertises expertise in cottage estate planning: www.lbkglaw.com

Getting Going for Summer 2011

Ok, so I set up the blog last fall but as we head into the summer I'm hoping that things start to take off here.  So if there's something that you think that the rest of us should know about, or something that you think we should be remembering in the long term, post it!

You may notice a link off to the right that leads to some Flickr photos.  I started a special group on Flickr for our cottage pictures, so if you have an account already then head over there for the membership request.  If you don't have a Flickr account, and you need help setting one up then call me and I can walk you through it.  You can view the photos without having a Flickr account, you just can't add any of your own.

I'm currently the gatekeeper for the admin account for the blog (otherwise I think things could get a bit messy), but if you have any ideas that you'd like to implement, or know of any widgets that you think would work well for our needs, then please let me know!

Here's to another great summer up north!

Non-Profit Corporation?

Family members may choose to register the title to the cottage in a non-profit corporation, especially if there are more than two or three co-owners. In this scenario, family members become due-paying members of the organization. The organization must establish a board of directors, which has various duties, such as setting out bylaws and rules relating to dues and maintenance. Although this strategy is beneficial to avoid family conflicts, it requires specialized advice and may not be suitable for everyone.

Family Trust?

Some thoughts about an unresolved issue. I need to look at the idea of a trust vs incorporation. It's either a better idea or Rudy Dorner is simply ahead of the curve with his advice to us to incorporate.

This article is more support for forward planning: Cottage Succession Often No Vacation

Incorporation

I had a brief conversation with my lawyer Glen Smith about incorporation and its costs. He thinks it is a reasonable idea, among others (could go the way of partnership as well - pros and cons to everything).

The costs would be incorporation fee ($1200 - $1500), land transfer tax ($7000), and yearly renewal ($150) and tax return, and capital gain tax (50% of net value after expenses/improvement costs - this can be lowballed by us so long as we stay under the radar of the CRA). The latter will have to be paid by our inheritors regardless, unless one buys insurance for them. I have already done this because I can't be sure if or when they would be able to afford this. Pay now or pay later, so I consider that a wash.

It is the fees which are the add-on to the status quo, but are the price for providing our inheritors with a structure to deal with future governance. Glen has dealt with a number of fights over properties purchased by a group of buddies 60 years ago (hunt camps) that are now owned by disparate collections of individuals who are unable to work things out, and are without such structures that would make things much easier.