Alter Ego Trusts

We prepare complete trust and estate plans to protect your financial legacy. Your Alter ego Trust will let your beneficiaries avoid complicated probate proceedings. Your loved ones will save probate fees and save time by skipping the lengthy probate process. Your affairs will also remain private by avoiding the filing of probate documents. Also, you will have the security of knowing that your heirs will be unable to frustrate your wishes with wills contest litigation. You will have the opportunity to discuss your estate plans and goals with a lawyer and ask any questions you may have and your estate plan will be specifically designed for your financial affairs. After we set up your comprehensive trust and estate plan, you will receive everything you need to take care of your affairs, protect you children and achieve piece of mind!


What is A Trust?

The concept of trusts is very simple. A trust is simply a mechanism where one person, the trustee, holds property for the benefit of another person, the beneficiary. However, this simple relationship can be very powerful tools to manage your finances. A properly drafted trust can be used to transfer your assets to your heirs without paying probate fees, prevent creditors from seizing your assets, minimize taxes and prevent will contests! If a lawyer tells you don’t need a trust, ask yourself if you would like to avoid probate fees, creditors, taxes and will variation litigation. Unfortunately, properly drafting trusts is complex. Most “estate planning” lawyers provide little more service than inserting your names on a simple will which you could download yourself off numerous websites for little or no cost. Any lawyer can type your name on a standard will and print it off. But that is not “estate planning”, that is simple word processing. If you really want to optimize your financial affairs, you need to consider the most power tool in a British Columbia estate planning lawyer’s arsenal: a trust.

How Does A Trust Work? 

A trust is a legal arrangement you make before your death to have someone manage your assets immediately or at your death.  Trusts are like wills in that you outline your wishes for the distribution of your property and care of any dependents before your death. Trusts differ from wills in that once you die, the person you named as the successor trustee takes over managing your property instead of the probate court.  This saves you time and a lot of money in probate fees.

A trust holds your assets for you during you life and it provides rules for the management and distribution of those assets after your death. A trust is managed by a trustee who administers the assets in the trust for the benefit of your beneficiaries. While you are alive and have capacity, you and your spouse will will act as the trustees of your trust. This means that you will control the trust and you will be able to exercise complete control of the trust assets. You can sell the trust assets, buy more trust assets, mortgage the trust assets or do anything else you like with the assets in the trust.

After both you and your spouse pass away, the control of the trust will pass to you successor trust who will then manage the trust on behalf of your beneficiaries and distribute the trust to your heirs. The successor trustee is required to follow the rules set forth in your trust and distribute the trust assets in accordance with your wishes.

Also, should you become incapacitated, your successor trustee would act on your behalf, handling financial issues and even managing property or business assets for you. It’s all clearly spelled out and, unlike a will, can be handled without any involvement by the courts.

Types of Trusts

There are many different types of trusts for use in different estate planning strategies. The Alter Ego Trust is a popular trust for people over the age of 65 years. An Alter Ego Trust is very powerful estate planning trust because it has exemptions from capital gains rules Similarly, the Joint Partner Trust, functions very similarly for a couple.  A Henson Trust is useful to protect the interests of a disabled family member.

Should You Have An Alter Ego Trust?

One big advantage of an Alter Ego Trust is that it allows you to avoid probate.  Probate fees can run several thousands of dollars.  A living trust enables you to give the money you would have spent in fees to your loved ones.  Further, an Alter Ego Trust lets your beneficiaries avoid the complicated and time-consuming probate court. Another advantage of a trust is that the successor trustee can take control of the trust in the event you become incapacitated and cannot make decisions for yourself.

Benefits of an Alter Ego Trust
There are many benefits to an Alter Ego trust. An Alter Ego trust can save probate, simplify the administration of your assets and protect your legacy from will challenges.
Avoid Probate Fees!
Properties that are transferred by will instead of a trust are subject to BC’s probate fees. The government essentially charges a tax of approximately 1.4% of the value of the estate assets. So, for example, if you probated a property worth $1,000,000 your estate would be subject to probate fees of approximately $13,450! An Alter Ego trust or a Joint Spousal trust avoid these costly fees.
Avoid Will Challenges!
In BC, your descendants can challenge your will and ask the court to change your intended distributions pursuant to the Wills Variation Act. Not only can a will change overturn your plans, but a will challenge is very expensive litigation process which can drain assets away from your beneficiaries to legal fees and expenses instead. Trusts however are not subject to the Wills Variation Act making trusts very difficult to challenge later.
Protect Privacy!
Wills are administered publicly in BC which exposes your financial affairs. Trusts, on the other hand, are not publicly administered which protects the confidentiality of your financial affairs.
Easier Transition!
Trusts are much easier and more efficient in transferring ownership and control of your assets. Assets distributed by will need to go through the lengthy and cumbersome will process. And while your assets are tied up in probate, it can difficult to manage the estate assets in an expedient manner. Even if you have a power of attorney to manage your assets, your power of attorney expires upon your death. A trust, however, avoids this problem because the assets are already held by your trustee prior to your death making the transition seamless and immediate.

Safe Harbour Trusts Law 
Trusts & Estate Planning Law Firm
666 Burrard Street #500
Vancouver, BC V6C 3P6
Tel. (604) 639-3191

Admitted to Law Society of British Columbia
in 1998, Law Society of BC No. 502571

Admitted to California State Bar in 2000
California State Bar No. 209838

Admitted to Practice in the
U.S. District Court – Central District in 2006

Trusts & Estate Planning Law Firm
666 Burrard Street #500
Vancouver, BC V6C 3P6
Tel. (604) 639-3191

Admitted to Law Society of British Columbia
in 1998, Law Society of BC No. 502571

Admitted to California State Bar
Since 2000, Califoria Bar No. 209838

Admitted to Practice in the
U.S. District Court – Central District

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