Quote:
Originally Posted by L-Pink
They don't have probate in Canada with a mandatory minimum waiting time for disbursement of funds?
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My father had money invested in RRSPs (Registered Retirement Savings Plan) that is to be divided up amongst us three children - my sister and I get 33% each, while my baby brother gets 34% - just the way the bank decided to split it.
Because my father and his mother are well known in the community, and well known by the bank holding his RRSPs, the bank has agreed to let us cash out his RRSPs as
survivor benefits ... meaning we will claim it as income on next year's taxes, but allowing us to cash it out immediately (with a simple letter of direction to the bank signed by the three children), rather than tie it up in probate to be later disbursed as a tax-free inheritance.
Also, having the funds tied up in probate would see us spend approximately 20% of the funds in lawyers fees, so cashing out the RRSPs as survivor benefits made much more sense from a financial standpoint.