15 June 2021 STEP Roundtable Q. 13, 2021-0883051C6 - Paragraph 104(13.4)(a) -- summary under Subparagraph 104(4)(a)(ii.1)

If an alter ego trust does not make the s. 104(4)(a)(ii.1) election, it will be subject to a deemed disposition under s. 104(4)(a) at the end of the day of the settlor’s death, and a deemed year-end on that day under s. 104(13.4)(a). Alternatively, if the election is not made, there is no roll-in of property into the trust (but instead a deemed disposition at fair market value); however, the trust will not have a deemed disposition or year-end on the death of the settlor and instead, a deemed disposition would typically occur on the trust’s 21^st anniversary.