Fast forward 10 years. Lynn Davies (see Part I above) passed away on the evening of December
Question:
Fast forward 10 years. Lynn Davies (see Part I above) passed away on the evening of December 1st, 2021. Mrs. Davies was 66 years old. In Lynn's last will and testament the shares of Davies Inc. issued to Lynn in Part I above are to be inherited by her children. None of the shares were redeemed before Lynn's death. The residue of Lynn's estate is left to Lynn's husband, Mr. Davies who is still living. Lynn owned some non-registered investments in publicly traded shares at the time of her death that Mr. Davies is to receive as a beneficiary of her estate. Lynn had $600,000 in her registered retirement savings plan ("RRSP") at the time of her death.
Mr. Davies was the named beneficiary of Lynn's RRSP.
Mr. Davies is the executor of the estate.
Required:
- What tax returns should be considered for Lynn with regards to her death and what are the filing due dates for those returns?
- Describe the tax treatment of the shares of Davies Inc. owned by Lynn at the date of death.
- Describe the tax treatment of the non-registered investments in publicly traded shares owned by Lynn at the date of death.
- What tax return must be filed for the estate if income is earned before properties are distributed to the beneficiaries. What option is available to minimize tax?
- How will Lynn's registered retirement savings plan ("RRSP") be treated for tax purposes. How can tax be minimized with regards to the tax treatment of the RRSP on her death?
Auditing and Assurance services an integrated approach
ISBN: 978-0132575959
14th Edition
Authors: Alvin a. arens, Randal j. elder, Mark s. Beasley