Before they head south

“Their provincial health insurance has limitations on payments for medical services outside of the country,” says Marilyn Piccini Roy, a partner with Montreal-based Borden Ladner Gervais LLP.

If a client has to be hospitalized or receive specialized treatments abroad, the financial consequences may be dire. While the average cost of a medical incident outside of Canada is estimated at US$26,000, a six-month insurance policy can cost less than US$1,000.

Help your clients choose the level of coverage that best suits their needs. Ensuring your clients have healthcare coverage can play a key role in helping them preserve their retirement savings.

> Keep wills and estate plans up to date
“Snowbirds are generally elderly people, and they may have wills that are long out of date,” says Roy , who specializes in estates and trusts. Many older clients may have drafted their wills when they first had children, she says, and neglected to update documents after having acquired new assets.

Pay special attention to the will if a client has purchased a property abroad, or is planning on doing so, Roy says. Property laws vary depending on jurisdiction, and it may be necessary to consult with a lawyer to make sure your client’s property is protected properly.

“It may even be wise to instruct the client to draft a separate will that deals with the property they own in a foreign jurisdiction,” Roy suggests.

> Consider disability planning
While estate planning is essential, disability planning should not be overlooked. “Disability planning often takes a back seat,” Roy says, “and it really should not, because some of the issues that come up when someone is incapable can be even more complex.”

To protect your clients should they become incapacitated while visiting the U.S., Roy suggests, encourage them to consult an American lawyer.

“Clients should be advised to make sure they have an appropriate power of attorney to the jurisdiction in which they own property,” Roy says. “The power of attorney they have in their home jurisdiction may not be recognized abroad.”

> Keep tabs on time spent abroad
Make sure your clients don’t overstay their welcome in the U.S., or there may be significant immigration and taxation problems.

A visitor’s visa, which is what most Canadians are typically issued, allows someone to visit the U.S. for 183 days in a year. Staying longer than that is illegal. However, keep in mind that the U.S. taxman measures residency differently from the immigration authorities. If your client stays in the U.S. for too long by the taxman’s calculations, he or she may have to file a U.S. tax return. As a rough measure, spending four months or fewer in the U.S. each year will keep your client from becoming a U.S. tax resident.

IE