The Benefits of Having a Wills and Estate Plan

image source: Giordano, DelCollo, Werb & Gagne, LLC

A wills and estate plan is an important part of financial planning. Everyone needs to have one, even if you are not a wealthy individual with millions in assets, as it will help protect your family in the event that you die or become incapacitated and can no longer make decisions.

A basic wills and estate plan provides many advantages, including the following:

Avoid probate court

Ending up in probate court is an expensive process. A vast majority of people end up giving a large portion of their hard-earned money to attorney’s fees just to prove the person authorized to represent your estate and oversee the distribution of your assets and payments to creditors. It’s also a very long process and it could take your loved ones, especially your spouses and children months, and maybe even several years to receive a penny. It’s not something you’d want them to deal with and you’d want to make sure that they avoid it at all costs.

Lessen Estate Taxes

Advance wills and estate planning can help you take advantage of tax-saving strategies to avoid significant loss of your estate to the payment of state and/or federal estate taxes or state inheritance taxes.

Through the most basic plan, you can avoid three common estate costs:

1. Probate fees - In Ontario,  probate fees to settle your estate, which is officially called an estate administration tax, can be very high and can reach as much as 1.5% of your estate’s value.

2. Estate tax on capital gains - For income tax purposes, it is considered that upon your death you have sold all your assets.   Your estate must cover the tax on any profit from the “sale” proceeds, of which 50 percent is taxed. If rental properties are included in your assets, there may also be capital cost allowance or CCA which is fully taxed.

3. Tax on tax-sheltered savings plans - Upon your death, your registered plans such as RRSPs (registered retirement savings plans ) and/or RRIFs (registered retirement income funds) can be transferred to your spouse’s or /common-law partner’s plan free of tax. However, If you don’t have a spouse or /common-law partner, the full value of each plan is fully taxable at your death and the remaining value to be passed on to any of your blood-related heirs can be dramatically reduced.

Protect your Assets and Beneficiaries

A variety of advanced estate planning techniques, such as using trusts, wills, and beneficiary designations, can help ensure that your children are properly protected. You can name a responsible guardian or trustee for them until they come of age to prevent any family discord and costly legal expenses against the children’s inheritance. A wills and estate plan can also add a layer of asset protection against creditors lawsuits and divorce decrees. It also allows you to maintain control of your property while you are alive regardless of your age, health or financial condition and to provide instructions on your care and the care your loved ones in the event of a disability.

The wills and estate law of Canada empowers you to set up a comprehensive plan that will help you to achieve goals that will ensure the protection of your assets during your lifetime and for your beneficiaries after your death. It’s really more than just protection from federal tax laws, but a lot more about making certain that your well-being as well as those of your loved ones are taken cared of the way you plan it to.

Corporate Lawyers for Startups and Small Businesses

Corporate lawyers deal with legal issues that face businesses day to day. They are highly specialized in multiple aspects of the law that relate to business operations, which can include securities and tax law, code compliance, contract negotiations, intellectual property, bankruptcy, and financial reporting,  among many other specializations

Unlike trial lawyers, they are not involved in litigation and do not spend a lot of time in the courtroom. Corporate lawyers focus their work mostly on business deals and commercial transactions. Their work involves a lot more collaboration with other lawyers, either from other companies to negotiate contracts or those with legal expertise in other aspects of law to help ensure that the company he works for complies with all local, state and federal applicable laws.

Some are hired directly by corporations as in-house counsel and act as internal advisers providing legal advice on issues ranging from labor and employment issues, intellectual property issues, contractual issues, and liability issues. Then there are those who work in large or midsize law firms and are hired as consultants by corporate clients to provide counsel on corporate governance framework and practices such as the rights and responsibilities of corporate directors and officers, and also to oversee activities associated with the daily needs of the business, including negotiation, drafting, mergers, acquisitions, and divestitures, financial reporting to owners, employees, shareholders and government agencies and other general oversight that may affect the legal activities of the company.

How can a corporate lawyer help new businesses?

Budding entrepreneurs can benefit a great deal with the services of a corporate lawyer. Startups are usually faced with numerous decisions, such as drumming up new customers, developing a website and launching a new product and often times the administrative and legal aspects are overlooked. It’s good to have a corporate attorney who will provide, not only advice, but also assistance to prepare, file and register all the necessary federal, state and local requirements, including zoning compliance, copyright and trademark advice, and formal business incorporation.

One aspect of law that any new business may find challenging involves the decision on the legal entity of the business. Determining the right legal structure of the business is crucial to help protect your personal assets from any liabilities of the company.

Whether the business will be set up as a corporation, a partnership, a limited liability company, a sole proprietorship, or even as a joint venture, it will have an effect on financial and legal matters that may potentially influence the success of the business in the long term. Each structure will have its own set of advantages and disadvantages and only a corporate lawyer is qualified to explain several issues involved, such as the implications of federal and state tax requirements and how to limit liability for the stakeholders.

  

Many corporate lawyers specialize in the laws involving new business structures. As such, they can also be involved in the development of the business plan, help you register your products and services for federal trademark and copyright protection and also in negotiating possible sources of financing, such as with investment bankers and venture capitalists.

The primary responsibility of corporate lawyers is to ensure that all business transactions involving their clients’ organizations are in compliance with the law at every level. But aside from their legal expertise, they must also possess a very keen business and financial acumen in order to make certain that business risks are minimized and clients make legal decisions that translate well for the bottom line.