How Inheritance Tracing and Heir Hunters Work in Ontario

A letter arrives saying a relative you may barely know has died and that you could be entitled to money. The sender offers to help you claim it in exchange for a share. It is natural to wonder if it is real, and whether you are being asked to pay too much.

This article explains how inheritance tracing generally works in Ontario, how to check a letter, and what steps protect you. It does not set out any fee, because fees depend on the contract you are offered.

What heir hunters and probate genealogists do

Heir hunters, also called probate genealogists or inheritance tracers, research family trees to find people who may be entitled to an estate. They may work when someone died without a will, when relatives are hard to find, or when a will leaves a gift to a person who cannot be located.

Without a will, the Succession Law Reform Act sets who inherits, generally the spouse and the closest next of kin, and a common-law spouse does not inherit under that Act. That is why family-tree research can matter: the people entitled depend on how closely they are related.

A legitimate tracer typically contacts a possible heir, offers to prove the relationship and the claim, and asks you to sign an agreement. Whether you need a tracer at all depends on your situation, so it is worth confirming with a lawyer before you sign.

How to tell whether the letter is genuine

Treat any unexpected letter or email with caution, because letters like this can sometimes be scams. Be careful about sharing money, identity documents or banking details before you have confirmed that an estate exists.

• Confirm the deceased person's name and that an estate actually exists, by contacting the estate's lawyer or estate trustee through a number you find yourself.
• Ask who the estate trustee is. An Ontario estate trustee winds up the deceased's affairs, pays taxes and debts, collects assets and carries out the will's wishes.
• Ask the sender for the company's full legal name, address and registration details, and check them independently.
• Never send money, a copy of your ID or banking details until you have verified the estate.
• Ask for any contract in writing and take your time. Legitimate firms do not need an answer the same day.
• Consider contacting the Office of the Public Guardian and Trustee or a lawyer if you are unsure.

What the probate process involves for beneficiaries

When someone applies for probate, the applicant must send or give the application to the estate beneficiaries before filing with the court. A person with a financial interest in an estate can also use Form 74P to ask to be notified of estate proceedings.

A person who appears to have a financial interest may also apply for directions on how to bring a matter before the court under Rule 75.06 of the Rules of Civil Procedure. These are options a lawyer can explain.

If the estate is a small one, valued at $150,000 or less, the applicant gives the signed application to everyone entitled to a share at least 30 days before filing. Either way, the estate trustee or its lawyer is the natural first contact.

Fees, contracts and what to compare

Heir hunters are commonly paid a share of what you receive, but any percentage is a matter of contract and should be checked before signing. Ask for the terms in writing, including whether the fee is calculated before or after taxes and expenses, and what happens if the claim fails.

How this applies depends on your situation, so it is worth confirming with a lawyer whether an estate-side process already exists.

Money, tax and what to do next

Most gifts and inheritances are not reported or taxed as income, though income earned on the money afterward is taxable. Foreign property is different: a Canadian resident who held specified foreign property costing more than $100,000 at any time in the year must file Form T1135, and for property received by inheritance the cost is its fair market value on the date received.

Separately, forgotten bank accounts are a different matter from estates. Bank balances inactive for 10 years are treated as unclaimed and moved to the Bank of Canada, which holds balances under $1,000 for 30 years and balances of $1,000 or more for 100 years.

• Keep the letter and envelope or email, and do not sign anything yet.
• Contact the estate's lawyer or estate trustee independently to confirm the estate.
• Gather documents showing your relationship to the deceased, such as birth and marriage records.
• Have a lawyer review any contract a tracer offers.
• Report suspected fraud to the police or the Canadian Anti-Fraud Centre.

Frequently asked questions