Protecting your assets and ensuring that you and your family members continue to benefit from them requires proper tax and estate planning. For many people a desire to avoid issues that they would prefer not to expend time, money and energy on coupled with the complexity of the laws governing tax and estate planning dissuade them from undertaking the necessary planning.

Inadequate planning can have far reaching consequences not only during your life but also after death that with which your family members will be saddled. If you are an American living in Canada, a Canadian living in the United States or you have family spread out between Canada and the United States, tax and estate planning takes on an even greater complexity that few Canadian or American lawyers are used to tackling.

At Levy Salis LLP, our team of legal professionals has over 25 years of combined experience in helping Americans in Canada and Canadians in the United States put in place the required tax and estate planning to protect their assets during their life and afterwards. Our knowledge of US and Canadian tax rules, their interplay under the Canada-US Income Tax Treaty and our ability to serve our clients in both Canada and the United States through our offices in both countries allow us to best serve our clients and provide them with custom-made tax and estate planning solutions.

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Planning for the disposition of your assets after your death is an unenjoyable exercise, but one that is essential to ensure that your family members are not burdened with avoidable complications that reduce their ability to enjoy the benefit of these assets. Ensuring that your assets are distributed according to your wishes, including property located in foreign countries, shielding your estate and family members from taxes upon your death, and protecting inheritances left to your family members from their creditors or in the event of divorce are all concerns that you can address with the right tax and estate planning.

At Levy Salis LLP, we work directly with you, family members and professional advisors such as investment advisors, accountants and lawyers to ensure that you can tackle these concerns and that your assets are promptly transferred to family members, friends and/or charitable organizations. Planning for the distribution of your assets after death requires first and foremost an evaluation of your assets and of your estate’s exposure to tax on your death.

Inadequate planning can result in a myriad of problems that your family members and friends with which they will have to deal (if possible) including, but not limited to, dying intestate (without a Will), guardianship for minor children, your family members’ inheritances being subject to claims from creditors or matrimonial claims in the event of divorce, triggering capital gains tax on death that can otherwise be deferred, and having conflicting wills in several jurisdictions.

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Canadian provinces and Israel regulate inheritances differently. Accordingly, expert guidance on Israeli and Canadian law is essential to proving that a Will is legally binding and to ensure that assets are distributed to the heirs in accordance with the Will. Where the decedent was a Canadian who owned property located in Israel, an expert opinion from a Canadian attorney will be required by either a financial institution or by an Israeli court to give effect to the Will. Conversely, a Canadian who is designated as an heir in the will of an Israeli relative will require counsel from an Israeli attorney to receive the bequest.

Levy Salis LLP is proud to participate in the Canada-Israel Law Bridge, a novel structure that aims to help Canadians with ties to Israel or property located in Israel, and Israelis with ties to Canada or property located in Canada to meet their tax and estate planning needs. Through this venture, we can devise and implement proper tax and estate planning to ensure the expedited distribution of your assets to your heirs after your death, and assist you with settling an estate with assets located in both Canada and Israel or heirs in both countries.

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Ownership of US real estate has always been popular for Canada whether for vacationing or for earning rental income. Fluctuations in the US real estate market and in the exchange rate between the Canadian dollar and the US dollar weigh heavily on the decision to buy or sell US real property. Other important considerations, namely tax and estate planning, and creditor protection, are often given short thrift by Canadians who purchase, own or sell US real estate.

Dying with US real estate without the property estate planning can result in probate, which prevents the property from being transferred to your family members until your Will has been approved by a US court. Probate can be a lengthy and costly process. Certain structures for owning investment real property that are advantageous for Americans can be disastrous for Canadians due to the interplay between US and Canadian tax rules. Canadians who sell US real estate are subject to particular US tax rules that do not apply to Americans.

The team of Levy Salis LLP can assist you with your US real estate projects and implement the necessary cross border tax and estate planning to guard against probate and incapacity, minimize your tax liability in the United States and Canada and protect your US real estate from creditor claims or matrimonial claims during divorce proceedings.

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For financial reasons, personal reasons or both, many Canadians wish to take advantage of the United States’ proximity and friendly relations with Canada to move temporarily or permanently to the United States. Many Canadians also seek to immigrate to the United States because their Canadian employers have expanded their business into the US market and essential employees or directors need to be sent to the United States to start and oversee the venture.

The United States grants three categories of visas. A Canadian can be sponsored by a US family member under a family sponsorship visa. Employment visas can be granted to Canadians who receive an offer of employment in the United States. Canadians who wish to invest in the United States or start a business in the United States can apply for an investment visa. Although these visas are available, US immigration law imposes strict and often complex eligibility requirements and grants wide discretion to US immigration authorities to reject visa applications.

In addition to the complex and restrictive nature of US immigration rules, applying for a US visa and immigrating to the United States requires dealing with a myriad of laws, rules and governmental departments and agencies. Levy Salis LLP and its network of experienced US immigration attorneys can assist you with every component of the US immigration process from devising an immigration plan to the submission of the visa application.

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Canadians who move to the United States, whether it is to be with family members, take advantage of a career opportunity or start a business, are often unaware of the Canadian and US tax implications of such a move. Each country’s tax system operates on different rules. Without the appropriate planning, a Canadian who immigrates to the United States can be caught in one or several tax traps that can be quite costly. Such things as Canadian mutual funds, interests in Canadian holding corporations and receiving distributions of income from Canadian trusts become problematic once you become a US tax resident.

Planning for cross border tax and estate planning issues should be an integral component of any move to the United States. What do I do with my Canadian investments? How do I hold title to US real property? How do I leave testamentary bequests to my family members in Canada? What is my exposure to the US estate tax? What US tax filing obligations will I have once I move to the United States? What Canadian tax filing obligations will I have after the move?

Our team of experienced cross border tax and estate planning lawyers and our network of professionals can assist you in properly planning your move to the United States to ensure that you meet your cross border lifestyle objectives and you do not fall into any Canadian or United States tax trap upon moving or afterwards.

When a family member or friend is incapable of managing property and personal care, including decisions relating to shelter, sustenance and medical care, it may be necessary for a person to be appointed to manage the person’s property and provide for their personal care. A person is incapable if the person cannot understand the information that is relevant to making decisions regarding the management of his or property, or his or her personal care, or is unable to understand the likely consequences of a decision or a lack of a decision.

In Quebec, Court proceedings to appoint such a person are called “institution of protective supervision”. Depending on the extent of the person’s incapacity, either a tutor or a curator is appointed who must act under the supervision of a tutorship council that is also appointed by the Court. During these proceedings, which can be lengthy and potentially costly, the person’s assets are frozen. In other Canadian provinces and in the United States, these proceedings are called “guardianship” proceedings. Like Quebec, these proceedings are performed before a court and the purpose is to appoint a “guardian” to manage the property and personal care of the person concerned (called the “ward”).

Proceedings for the institution of protective supervision can be simplified and accelerated if the incapable person signed a valid Protection Mandate before he or she became incapable. A Protection Mandate appoints one or several persons to act as the incapable person’s “mandatary” or “mandataries” to manage his or her property and his or her care in the event that the person becomes incapable. A Protection Mandate must be homologated by a Court for it to take effect. However, provided no party contests the validity of the Protection Mandate, this process requires minimal court involvement as it can be performed by a Quebec notary who is duly accredited to conduct this type of legal proceeding. Moreover, no tutorship council needs to be appointed; only the persons appointed to act as mandataries will act, which reduces the potential for conflict. Richard P. Salis, partner at Levy Salis LLP, is a Quebec notary and has the required accreditation to conduct proceedings to homologate a Protection Mandate.

Guardianship proceedings in common law jurisdictions can also be avoided. If an individual signs a valid Power of Attorney to appoint attorney(s) to manage his or her property and his or her personal care prior to becoming incapable, guardianship proceedings are not required should the individual become incapable.

If you are a Canadian and you have assets in the United States, your Protection Mandate or Power of Attorney, which is valid in Canada, may not be valid in the United States. Each Province and State regulates Powers of Attorney and has conditions for the recognition of foreign Powers of Attorney. Moreover, US financial institutions do not always recognize a Canadian Power of Attorney. Conversely, Canadian institutions do not always recognize a US Power of Attorney. We recommend that you have Powers of Attorney in each jurisdiction in which you own property to plan for the management of your property in the event you become incapable.

Should you wish to plan in advance for incapacity or if a family member or friend has become incapable, we can prepare the requisite Powers of Attorney in the former case or assist you with the requisite proceedings to appoint a tutor/curator/mandatary/guardian to manage the person’s property and look after his or her personal care.

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If you are the named the executor (or “liquidator” in Quebec) of a deceased person’s estate, you assume a great responsibility for which few people are prepared. Settling an estate requires considerable leg work as it entails conducting an inventory of the deceased’s assets to identify the estate’s assets and their value, and the estate’s debts, winding down the deceased’s financial affairs, paying all debts and taxes and distributing the estate’s assets to the heirs. You must also comply with many legal rules to avoid personal liability for your actions.

The responsibility of settling an estate becomes even greater if the deceased had assets located in several jurisdictions as each jurisdiction has its own applicable rules for transferring the deceased’s property. If the deceased was a Canadian who owned US real estate and bank accounts in Israel, you may be overwhelmed because you will be confronted with US and Israel legal rules in addition to the ones applicable in Canada.

Operating out of offices in Montreal, Toronto, Fort Lauderdale and Tel Aviv, our team of experienced lawyers and notaries, supported by a network of legal professionals in Canada, the United States and Israel can navigate you through your daunting responsibility and ensure that the wishes of your close relative or friend are carried out.

Many US citizens living in Canada and Canadians with Green Cards who have moved back to Canada are unaware of the full scope of their US tax compliance obligations. Consequently, they neglect to these obligations. Others may be fully aware of these obligations and compliant with them, but wish to be free of them.

All US citizens have the right renounce their US citizenship and all Green Card holders have the right to surrender their Green Cards through formal processes. Although both US citizenship and a Green Card can be indirectly or implicitly lost, the US Immigration and Nationality Act and judgments of the Supreme Court of the United States both require that an individual prove an intention to relinquish US citizenship or abandon his or her Green Card. If you wish to terminate your status as a US citizen or a Green Card holder, we recommend that you go through the formal process to make your intention clear.

Renouncing US citizenship and abandoning a Green Card can both have important US tax consequences of which many individuals are unaware. Certain US citizens and Green Card holders who expatriate may be deemed to be a Covered Expatriate if they have a net worth of over $2 million USD, have a net US tax liability that exceeds a certain threshold or fail to certify US tax compliance for the previous 5 years. Covered Expatriates are subject to a “mark-to-market” exit tax: they are deemed to have sold their worldwide assets at their fair market value on the day of expatriation and are taxed on the deemed capital gain. In addition to this tax, gifts or testamentary bequests that a Covered Expatriate makes to a US resident will be subject to a tax.

At Levy Salis LLP, we can advise you on the tax consequences of expatriation, implement the requisite strategies to minimize these consequences and guide you through the process of terminating your status as a US citizen or as a Green Card holder.

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