The process of dealing with someone's death, however, becomes more challenging if you are the executor or chosen representative.
You find yourself suddenly in charge of sorting through this person's life, possessions, and documentation.
Not only is it difficult to determine which papers must be retained, but it's also not always clear how long they must be kept.
While a qualified law firm may assist you in sorting through records and choosing which documents to save, the following list of items should be preserved and for how long:
HOW LONG SHOULD TAX RETURNS BE KEPT?
The tax returns are typically the main issue when handling a deceased person's legal records.
The four-year statute of limitations applies to tax audits. This permits the CRA (Canada Revenue Agency) to audit the deceased's tax returns at random for the following four years.
Despite this statute of limitations, it is advised that you keep all tax documents for at least six years in case any issues with the decedent's returns come up.
This contains any files that have been filed as well as significant tax forms and receipts.
WHAT OTHER RECORDS SHOULD BE KEPT?
Documentation for a deceased person goes beyond tax filings.
Despite the fact that keeping track of all the paperwork may seem burdensome, the following key records should be preserved in four different categories:
LEGAL RECORDS
Any document pertaining to the law, whether it be federal, provincial, or local, is considered a legal record. Records of this nature ought to be preserved indefinitely.
This implies that all legal records must be transferred from beneficiary to beneficiary.
Therefore, if you have inherited these documents, you should save them with your own important documents and provide them to your beneficiary.
These records include the death certificate for the deceased as well as the records listed below:
- Birth certificate
- Social security card
- Marriage certificate
- Divorce decrees
- Legal will
- Death certificate
Any of these documents can be needed to handle estate-related business. Particularly, you should have proof of your marriage, prenuptial agreement, and/or divorce since if you don't, estate issues might arise.
If nothing else, you might want to save these significant papers for family history or genealogy purposes.
FINANCIAL DOCUMENTS
The necessity of preserving the decedent's tax returns has previously been mentioned, but there are additional financial records that must be preserved as well.
These records need to be kept for at least three years after any required estate taxes have been paid.
Financial records of importance include:
- Account statements
- Receipts
- Pay stubs
- Retirement benefit and distribution statements
- Tax returns
These documents might be required during a tax return or possibly an audit, so it is essential to have them on available.
MEDICAL DOCUMENTS
It is recommended to save medical records and information for at least ten years.
However, due to privacy rules, you would need to be a designated representative or legal executor of the person's estate in order to access their medical data.
Important medical records include, for instance:
- Health insurance cards
- Medical tests
- Medical history
- Prescriptions
- Hospital discharge papers
These records will assist in determining the deceased's health coverage options and any ailments they may have had (or did not suffer from).
This knowledge is particularly beneficial because it enables family members to determine whether any of these ailments are inherited.
Additionally, you might wish to maintain track of the visits and treatments that were given by keeping paperwork of the outcomes of hospital stays.
OTHER IMPORTANT DOCUMENTS
After a person dies, you could find yourself going through a collection of unrelated paperwork.
How do you decide what to save and what to discard?
Be sure to maintain the following records before discarding anything that is not legal, financial, or medical:
- Diplomas
- Home and car insurance
- Rental agreements
If you and the deceased lived together, you can still handle their correspondence and read their mail. You might want to think about getting in touch with the sender to let them know the person has passed away.
Before you may make any changes to the deceased's postal service if you did not reside with them, you must show that you are the executor of their estate.
In addition to mail, you should aim to maintain these records for at least 10 years, especially the home and auto insurance records because they can be useful in effectively administering the estate.
Other than that, degrees are rarely legally necessary for anything but could hold sentimental value.
ORGANIZING IMPORTANT DOCUMENTS
It can be difficult to sort through a deceased person's possessions, especially when there is paperwork involved.
Purchase an accordion file folder to arrange the workload and make it less stressful by dividing the paperwork by year.
Every year, check the folder to see what information no longer needs to be preserved and make sure to label everything.
Do not hesitate to get in touch with your qualified attorneys if you are managing the papers of a deceased family member, friend, or loved one.
We will take the time to help you understand the paperwork and make sure that the important papers are kept secure.
