Alter Ego Trust (BC)

Summary

This precedent is an alter ego trust, which permits taxpayers 65 years of age and over to bypass the probate process and avoid wills variation claims. This trust has been drafted to meet the requirements specified under the Income Tax Act, R.S.C., 1985, c. 1 (5th Supp.). It includes practical guidance, drafting notes and optional clauses. The Alter Ego Trust allows taxpayers 65 years of age and over to bypass the probate process because, upon the death of the settlor, any property under the trust will pass directly to the beneficiaries under the trust without the requirement to probate a will. The trust has the added benefit of providing some incapacity planning: the trustee manages the trust property for the settlor, if the settlor subsequently suffers from a mental incapacity. Where the settlor is the initial trustee, as is often the case, the replacement trustee will assume management of the trust property upon such incapacity. The other use for the alter ego trust is that it can be...