Insolvent Estate
Solutions for an Insolvent Estate OF A DECEASED PERSON in Ottawa
Losing someone close to you can be difficult to deal with. When grieving, the focus is on emotions, and the administrative aspects are often avoided. It must be taken care of, even if it may seem secondary. But sometimes, you don't have the knowledge you need to make the right decisions. At Bernier & Associates, we advise and support you in your efforts. Our professionals are there to help you in the event of an insolvent estate in Ottawa, Gatineau, Abitibi, Montreal, East Ontario or in any of our 15 offices. Do not hesitate to contact us for all your questions or to entrust us with your case.
What is an Insolvent Estate?
An insolvent estate is one where the liabilities (debts) are greater than the assets (property). In other words, the liquidation of all the assets does not pay off all the debts.
It is essential not to rush but to consider all possible options first: if you accept the estate, you also inherit all the debts and become liable for them.
What is Considered a Liability in an Estate?
All debts related to the deceased are included in the liabilities of an estate:
- Bills that have not been paid (credit cards, lines of credit, consolidations)
- Income taxes
- Retail sales tax including goods and services tax (for self-employed workers)
- Endorsement or co-signature to guarantee debts
- Rent including utilities
- Responsibilities as a director of a corporation
What Are the Options for the Heir or the Executor?
If you inherit an insolvent estate in Ottawa, there are several options available to you. You can accept the estate: in this case, you will inherit not only the assets but also the debts. It's best to be familiar with the deceased person's financial situation before making this decision. Moreover, this can put a strain on your own finances. Don't hesitate to consult our blog to see for yourself if you are heading towards bankruptcy.
You can also refuse the estate: if you choose to do so, you will have to register your renunciation by notarial act. You have 6 months to accept or refuse an estate. If there is no notarized document stating that you refuse the estate, you will be deemed to have accepted it.
In the meantime, do not use the deceased's property as if it were one of your personal assets since you will then be guilty of tacit acceptance of the succession.
A third option is also possible: put the estate into bankruptcy. The services of a licensed insolvency trustee will then be required.
Whatever your choice, never forget that you should not accept an estate without thinking about it beforehand and receiving sound advice.
Why Use a Licensed Insolvency Trustee?
By entrusting the bankruptcy of the estate of a deceased person to a licensed insolvency trustee such as Bernier & Associates, you are relieved of an important administrative burden and certain obligations:
- Delays are eliminated
- The liabilities of the estate are no longer your responsibility
- Disputes with creditors and possible legal proceedings are handled by the trustee
- Objects that have more emotional than material value, such as family heirlooms, are usually given to you
- In the case of an estate bankruptcy, the heir's finances are not impacted.
- The trustee takes charge of the assets in order to liquidate them for the benefit of the creditors
- Bankruptcy will have the effect of extinguishing all debts of any kind of the deceased
Consult Us for Insolvent Estate Solutions in Ottawa
Dealing with an insolvent estate can be a complex, challenging, and stressful situation to navigate. Bernier & Associates has the experience and knowledge to guide you in your decision-making toward the best possible outcome. Request an appointment with our team to discuss your situation.
