Divorce Equalization Payment Calculation Case StudyEqualization A Case StudyLeslie a $49-$year$-$old School Teacher and Brian, a $51-$year$-$old Plumber, theyre really hoping toavoid a lengthy and protracted negotiation. They both agreed mediation was the best fit forthem, if only for the sake of their children $14-$year$-$old Michelle and $17-$year$-$old Maradith.Brian and Leslie experienced the devastating effect of Leslies sisters bad divorce two yearsearlier.He earns approximately $$87,000$ with his Plumbing Business. She earns $$93,000$ per year as aschoolteacher.The couple owns a home jointly with $$1,250,000$ of equity. The balance of the mortgage is$$550,000.$Non$-$Joint AssetsBrians Plumbing Contracting Business has a pre$-$tax value of $$135,000.$ He also has anRRSP with a pre$-$tax value of $$216,600.$ The pre$-$tax value of the Wifes Teachers Pension is$$600,000.$ They each have cars and individual bank accounts.Debts $($Liabilities$)$Brians total liabilities are $$426,845,$ while Leslies debts are $$467,845.$ Brians debts include hisshare of the mortgage and the joint RBC Visa Credit Card. Also, his car loan. Leslies debtsinclude her share of the mortgage and the joint RBC Visa Credit Card. Also, her car loan.They each have other obligations related to their more considerable assets valuations.For Leslie, a $$114,000$ contingent tax liability connected to her pension is accounted for in herNet Family Property.Brian has a $$45,000$ contingent tax liability associated with his RRSP and business valuation.Consider in your response the following:$1.$ What is equalization payment$2.$ Calculate the NFP Net Family Property to assess which of the couple must pay theequalization amount $($show all working$)$ESTATE PLANNINGAbout the client:Life Stage: Brink of Retirement With $2$ ChildrenEmployment Status: Business OwnersHousehold Income Range: $$1$m $$1\mathrm{.}5$mBusiness Revenue Range: $$300$m$+$Asset Summary: Company worth approx. $$1$billion, six properties approx. $$35$m$,$ vehicles worth$300$kLiability Summary: Loans $$3$m Live in Toronto Two children: Peter $($age $29,$ married$)$; Carter $($age $25,$ married$)$ One grandchild $(11),$ and one on the wayWilliam $($Bill$)$ and Stacy Maynard are a married couple in their sixties, approaching retirement.They have a net worth of $$1$ billion. Bill started an IT firm, Maynard Software. The Maynardsown the business together and hope to sustain the company as a family business. Both of theirchildren studied computer science and worked for the family company.The couple has thought about their future significantly, including protecting future generationsand making charitable donations. They did forget one crucial plan, however, an estate plan.They have an existing plan, but it is outdated. They have discussed updating the plan, and theyknow what they find essential, but they have not taken the time to incorporate these new ideasinto the existing plan. Since the formation of their initial plan, the income has grown, and theyfear potential tax issues can arise.Typically, the Maynards have had an attorney draw up basic estate planning documents, suchas revocable trusts, but have doubts that the structure of their estate plan aligns with theircurrent situation. When the documents were drawn, the couple only had their first child anddid not plan on having a second. Now that their children are married, and have one grandchild,with another on the way, they would like to incorporate their childrens spouses andgrandchildren in their plan. Their current grandchild, $11-$year$-$old Megan, has a promising futureas a ballet dancer, so they would like to keep in mind education for the future and education ofgenerations to come. Also, as their estate grows, they are concerned about federal andprovincial estate tax exposure.They have already put their children through college, so that is no longer a concern. Theircurrent monthly household expenses sit around $$25,000$ a month after tax. Currently, thecouple is in the $35\%$ tax bracket.NeedsIdentify what you believe to be the needs of this family and prepare the estate plan in detail.Identify each step of the planning process.You are the advisor so whichever direction you take in assessing what you believe to be theirneeds, you must defend it in your response.