Naming a U.S. resident as executor of your Ontario Will
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Having a U.S. executor in a Canadian will can present practical, legal, and tax implications. Executors are responsible for administering the estate, and their residency can affect the estate’s administration and tax status, particularly when one is outside of Canada. Here are the key considerations: 1. Residency and Tax Implications Canadian Estate Residency : An estate is generally considered a resident of the country where the majority of its executors reside. If a U.S. co-executor is involved, the estate may be deemed a non-resident for Canadian tax purposes, leading to: Potential exposure to U.S. estate taxes. Loss of graduated tax rates on income earned by the estate in Canada, as the estate could be taxed as a trust for non-residents. Tax Filings in Both Countries : The co-executor in the U.S. may need to file returns in both Canada and the U.S., increasing complexity and administrative burden. 2. Practical Challenges Cross-Border Coordination : The U.S.-based co-executor may fa...