Non-resident Estate Tax Implications

Not sure if this is a question that can be answered on this forum, but here it goes.

My sister who lived in Montreal recently passed away. She left the executorship responsibilities to her common law. He now is finding it difficult to carry on with the duties and has asked me (recognized in Will as backup executor) to take on the responsibilites. I live in the US. But remain a canadian citizen.

I have heard (unofficially at this point) that there are tax implications on the Estate if a non canadian resident becomes the executor.

Does anybody have any experience with this?

Thanks in advance.

No tax obligations as merely executor, and the fact that she has now died, should mean you can take care of this pretty quickly.

Executor is different that trustee. If you were asked to become a trustee, I would suggest that he find someone in canada.

In any event, isn't this a good example to show that one should NEVER nominate close family as executor...

There are no additional tax implications other than the usual ones. The main problem is that probate is in Québec and you aren't.

Hi! I'm BC resident, daughter lives in Calif, is dual citizen. Small family at this time, just her and me. I want to make her executor for me, but don't want to cause difficulties for her in probating. Have any further info re this in your probating for your sister?

She's also the beneficiary. Any info on this re her being US resident?

Thanks in advance for info from any source.

It is best not to have a US person be executor of your Cdn estate. There is a reporting burden -- even yearly if you have anything in a trust -- placed on her that is unnecessary if you simply choose a Cdn friend.

Hi! I'm BC resident, daughter lives in Calif, is dual citizen. Small family at this time, just her and me. I want to make her executor for me, but don't want to cause difficulties for her in probating. Have any further info re this in your probating for your sister?

She's also the beneficiary. Any info on this re her being US resident?

Thanks in advance for info from any source.

Not sure how the US treats this situation but as far as Canada is concerned (and it will be if you live in BC) if the trustee/executor is non-resident then the estate becomes non-resident too and various different rules apply, like the Canada - US Tax Treaty, for calculating taxes estate returns. On the other hand, your daughter might still be resident of Canada in the eyes of CRA (yup, she could be seen as resident by both Canada and the USA due to their different criteria) by virtue of ties kept with Canada (property, family, memberships, credit cards, etc). In that case Canada would apply its own rules while the US would apply its own rules too to the estate. Lots of fun and complications.

yup, she could be seen as resident by both Canada and the USA due to their different criteria

If a person is considered resident in both treaty countries, then tie-breaker will apply and one country will be determined as residence.