Advanced Curriculum Chapter 6_Estate Planning

Question 1

WILL - What are the key functions of a will?

Answer 1

Asset distribution, executor appointment, and guardianship designation.

Question 2

INTESTACY - How are assets distributed if there is no will?

Answer 2

Based on provincial laws, prioritizing spouses and children.

Question 3

TYPES OF TRUSTS - What is a Henson Trust?

Answer 3

A trust designed to protect disabled beneficiaries’ government benefits.

Question 4

TAXATION AT DEATH - How does the deemed disposition rule work?

Answer 4

All assets are taxed as if sold at fair market value at death, unless transferred to a spouse.

Question 5

ESTATE FREEZE - What is the benefit of an estate freeze?

Answer 5

It locks in the tax liability of current owners while passing future growth to heirs.

Question 6

BUY-SELL AGREEMENT - How does life insurance support buy-sell agreements?

Answer 6

It provides liquidity to buy out a deceased owner’s business shares.