1st Deceased Return

I am doing my first deceased return and it is quite basic, but would like some help for myself and my client’s (Stepchildren & Grandmother).

Client is a widow and had been living in a personal care home. I did her 2019 return and have her authorisation from last year through the POA.

Any input as to order of filing personal, final and requesting clearance certificate will be greatly appreciated.

Thank you and stay safe…

Welcome to the user forum!

Unfortunately, IMHO, it is NEVER possible to say that a “deceased return and it is quite basic” and be correct… :worried:

For example, you have NO AUTHORIZATION AT ALL to prepare this tax return.

Neither do you have ANY AUTHORIZATION AT ALL to request a clearance certificate.

If you touch any of this stuff as described, you may well be placing yourself in the immediate position of the exposure of the possibility of being sued by any interested party (heirs and/or intestate successors etc).

I would say that you need to talk to the Executor (and/or Administrator) before taking your next breath and before accepting this new engagement…

1 Like

We’ll said and VERY true

1 Like

Thank you very much for your prompt and thorough response. If I understand you, I will need a new Authorize a Rep form from the executor or administrator and a Letter of Direction on file would help.

1 Like

That would still not give you authorization to prepare the returns.

So far, you have not been hired by the person with authority to hire (Executor), the terms evidenced in your engagement letter, executed by both parties…
The Executor is a great risk here - they should be encouraged to seek professional legal advice.

1 Like

I think the new Auth Rep forms carries over on death. That said, you would definitely need a new engagement letter and/or letter of direction from the executor.

The CRA guide for deceased persons T4011 is very detailed and a useful starting point if you’re looking for a step by step guide. Unfortunately no one here can really give you specific direction as every situation is so unique and depends highly on assets owned at the time of death, beneficiaries, etc. Good luck!

2 Likes

That is only an online convenience bridging measure CRA implemented to assist taxpayers and their reps with continuity if the same rep-person eventually becomes authorized by the estate - it has no legal force, and is dangerous to abuse without the underlying legal authority.

1 Like

If you’re just asking about the order of filing (not who has legal authorization to file), then:

  1. File the final T1
  2. File any additional returns - Rights & Things, T3 for the estate, etc as applicable
  3. Wait for Notices of Assessment
  4. File TX19 - application for clearance certificate

However, you may want to wait before filing the final T1, until it is determined whether the estate has capital losses, etc that can be carried back to the final T1.

2 Likes

Thank you. Your answer really helps. She was widowed with no real estate or investments, HISA and chequing account, a survivors federal pension, and that is it. Will get LOD from executor/administrator and go from there.

I would get a copy of the Death Certificate and the Will on file as well.

I also take a copy of the Executor’s current government issued ID on file, as proof that I verified that I actually checked that this person is the person who is named in the will.

1 Like

I believe Joe was referencing to the need for an engagement letter establishing your role, signed by the personal representative(s), executor(s) and/or executrix(es).

As you still have access to the account, there is no need to reapply. It could be weeks before it is reinstated.

As of this year, CRA no longer automatically revokes consent for a decedent’s online account.

1 Like

The executor is my step son, and I have a copy of the will, which is being probated and I am wainting for death certificate. CRA has been notified My stepson has a lawyer. I have started final return and will be following the order Nelson suggested;

  1. File the final T1
  2. File any additional returns - Rights & Things, T3 for the estate, etc as applicable
  3. Wait for Notices of Assessment
  4. File TX19 - application for clearance certificate

The only disbursements in the estate will be cash. 2 quick questions
1.Can the final return be return be filed prior to will being probated?
2. In the info section, should “Estate of” be put before last name?

Thanks

  1. Not a good idea. Wait for probate to clear. If there are no assets other than cash, it shouldn’t take that long.
  2. Usually you put “Estate of the late …” before the first name. For instance, if the deceased was John Smith, it would now be last name “Smith” first name “Estate of the late John”. Not sure if this is a requirement or just a rule of thumb…

In respect to the question about changing the name…

The CRA does not allow for a name change on a person who is deceased. I was asked to put a name change on a deceased estate because, I was told that the deceased used a variant of their name their entire life and, at the time, I was young and stupid. Nasty error message was produced. Never tried that again!

That being said, they will typically ignore “The Estate of the Late” before the first name, because they don’t care about the first name. So if you want to place this in front, do so only if you are filing to the Federal government and not to the Quebec one.

I never add “The Estate of the Late” to the deceased person’s First Name.
In prior years using Profile software, I would always enter “Estate of the Late” at the top of the 1st page of the T1 General. That is sufficient to tell CRA that this is a Final Return for the deceased.

In TaxCycle, entering the date of death and Type of Return on the info page triggers the type of return to be recorded on the top of the T1 Jacket (ie: “Final Return”). Nothing more required.

NB: experimenting with TaxCycle, the DLetter is designed to acknowledge “The Estate of the Late”, so if you append this to the , it will be duplicated in the DLetter. So best not to append it to the First Name, else you have to modify the DLetter to remove the duplication.

Just looked at that. Thanks Gerry