How we help
- Coordinated Canadian and US wills
- US estate-tax exposure analysis for Canadians owning US-situs assets
- Qualified Domestic Trust (QDOT) planning where the surviving spouse is not a US citizen
- Spousal rollover (ITA s. 70(6)) and US marital deduction coordination
- Canada-US treaty Article XXIX-B (estate-tax credit) analysis
- Beneficiary-designation review for cross-border families
Two death-tax systems that don't talk to each other
Canada does not have an estate tax. It has a deemed disposition at death under subsection 70(5) of the Income Tax Act, which treats most capital property as sold at fair market value the moment before death and applies capital-gains tax to the accrued gain. The estate then pays the resulting income tax.
The United States has an estate tax. The 2024 federal exemption is approximately US$13.6 million per individual (it sunsets in 2026), and the top rate is 40%. US citizens and US tax residents are subject to estate tax on worldwide assets; non-resident aliens are subject to estate tax only on US-situs assets — but with a far smaller exemption (US$60,000 unless modified by treaty).
When a family touches both systems, the two regimes can apply to the same asset at the same time. The Canada-US Income Tax Convention's Article XXIX-B provides credit relief, but the relief is partial, prescribed, and easy to lose through poor coordination.
US-situs assets owned by Canadians
A Canadian who owns US real estate, US-corporation shares, or tangible personal property located in the US has US-situs assets for estate-tax purposes. Without planning, those assets can trigger US estate tax at death — even if the Canadian never sets foot in the United States and has no other US connection. The treaty's prorated unified credit (Article XXIX-B(2)) helps, but only at the upper exemption tiers; smaller estates frequently get caught.
Planning options include holding US real estate through a Canadian corporation, holding through a partnership structured to avoid US-situs treatment, life insurance to fund the projected estate-tax bill, and using a cross-border irrevocable trust to remove the assets from the gross estate.
Mixed-citizenship spouses and the QDOT
A US citizen who dies leaving property to a non-US-citizen spouse cannot use the unlimited marital deduction in the ordinary way — the deduction is denied unless the property passes to a Qualified Domestic Trust (QDOT) that satisfies IRC section 2056A. The QDOT defers the estate-tax hit until the surviving spouse takes principal distributions or dies, but it requires a US trustee and a series of substantive conditions.
For Canadian couples where one spouse is American, a QDOT can be the right answer — or it can be the wrong answer, depending on where the surviving spouse intends to live and whether the deferred estate tax is likely to ever be paid. Cross-border estate planning at the will-drafting stage materially changes the surviving spouse's position decades later.
Coordinating wills
A US-style will drafted by a US lawyer who is not familiar with Canadian capital-gains-at-death rules can inadvertently increase Canadian tax (for example, by directing a non-rollover distribution to a non-spouse beneficiary). A Canadian will drafted without US estate-tax in mind can create unnecessary US-situs exposure. We coordinate the two so the documents reach a consistent result on both sides.
How we work the file
A typical engagement starts by classifying every asset by tax situs and by who would receive it under the current will. We then run the projected Canadian and US tax bill if the testator died today, identify the largest exposures, and propose changes — usually some combination of revised beneficiary designations, retitling, life insurance, and trust planning. We work with the family's estate solicitor on the will itself.
What to expect when you call us
Your first call is a free, no-obligation consultation with a tax lawyer. We will review the details of your situation, explain your options under the Income Tax Act and CRA administrative practice, and give you a clear, fixed-fee quote if you choose to retain us. Your consultation is confidential, and once we are retained, communications are protected by solicitor–client privilege.
If you retain us, we begin work within 24 hours of being retained.
Frequently asked questions
Is the consultation really free?
Yes. Most cases qualify for a free, no-obligation consultation with one of our tax lawyers. During the call we'll review your situation, explain your options, and give you a clear quote if you decide to retain us.
What does a tax lawyer do that an accountant does not?
A tax lawyer focuses on the legal side of tax — disputes, litigation, and the structuring of transactions in light of the law and anti-avoidance rules. That includes representing taxpayers in CRA audits and objections, appearing at the Tax Court of Canada, defending penalties and director or derivative liability, and designing reorganizations such as section 85 rollovers and estate freezes.
The most practical distinction is privilege. Communications with a lawyer are generally protected by solicitor-client privilege, while communications with an accountant generally are not and can be demanded by the CRA. Where the facts are sensitive or the matter could become contentious, that protection matters.
Lawyers and accountants often work together — the accountant on the numbers and filings, the lawyer on strategy, privilege, and the legal record. Barrett Tax Law regularly coordinates with a client's existing accountant.
Do you serve all of Canada?
Yes. Barrett Tax Law represents clients across Canada. We have offices and local phone lines in Toronto, Calgary, Edmonton, Fort McMurray, Ottawa, Vancouver, and Winnipeg, plus a national toll-free line at 1-877-882-9829.
Who is Barrett Tax Law and what areas does the firm handle?
Barrett Tax Law is a Canadian boutique tax law firm that represents individuals and businesses in their dealings with the Canada Revenue Agency. The firm's work spans CRA audits and disputes, voluntary disclosures, Tax Court of Canada litigation, collections matters, and corporate and estate tax planning.
The firm was founded in 2009 and has represented many thousands of clients across Canada. Its head office is in Concord, Ontario (Vaughan), and it serves clients nationwide. You can reach the firm toll-free at 1-877-882-9829 (1-877-8-TAXTAX).
Most matters qualify for a free, no-obligation consultation, and most are quoted on a fixed-fee basis once scope is understood, so the cost is known before work begins.
What does a tax lawyer do that an accountant cannot?
Accountants prepare returns and financial statements. Tax lawyers represent you when those returns are challenged, audited, or prosecuted — and our communications are protected by solicitor–client privilege, which accountant communications generally are not.
What should I do if I receive a letter from the CRA?
First, identify what the letter is and what it requires. A CRA letter may open an audit, ask for documents, propose adjustments (a proposal letter), confirm a reassessment, or start collection action — and each carries its own deadline and its own implications. Note any date by which a response is required.
Do not ignore it, and be careful about responding off the cuff. What you say and produce can shape your later objection and appeal position, and casual admissions can be difficult to undo. If the letter proposes adjustments or penalties, or if significant amounts are involved, get advice before responding.
A free consultation can help you understand the letter, the deadline, and the right next step. Acting early — while options are still open — is usually far better than waiting until a deadline is near.
Will the CRA criminally prosecute me?
Most CRA disputes are civil. Criminal prosecution is reserved for serious tax evasion or fraud, usually involving deliberate misrepresentation. If you have unreported income, a voluntary disclosure is one of the standard ways to reduce criminal-prosecution risk.
Is the first consultation really free?
Yes. Most matters qualify for a free, no-obligation consultation with an experienced tax lawyer. The consultation is a chance to describe your situation, get a clear sense of the options and likely path, and receive a fee structure in writing before you commit to anything.
You can reach the firm toll-free at 1-877-882-9829 (1-877-8-TAXTAX) to arrange a confidential consultation. The head office is in Concord, Ontario (Vaughan), and the firm serves clients across Canada.
Are my communications with a tax lawyer confidential?
Yes. Communications between you and your lawyer for the purpose of obtaining legal advice are generally protected by solicitor-client privilege, one of the most strongly protected confidences in Canadian law. In practical terms, the CRA generally cannot compel disclosure of privileged communications.
This is an important difference from working with an accountant or other non-lawyer representative, whose communications and working papers can generally be demanded by the CRA. Where the facts are sensitive — unreported income, offshore assets, or potential penalties — that protection can be significant.
Privilege has limits and can be waived inadvertently, so it should be handled with care. A consultation can explain how privilege applies to your particular situation.
How fast can you start on my case?
We typically begin work within 24 hours of being retained. For audit deadlines, Notices of Objection, and other time-sensitive matters, we move immediately.
What if I have unfiled tax returns from many years ago?
We routinely handle 5+ years of unfiled returns. Through the Voluntary Disclosures Program — applied for before the CRA contacts you — we can usually eliminate gross-negligence penalties and limit interest exposure.