If my Estate doesn’t have sufficient assets to pay the income taxes owing, can the Canada Revenue Agency go after my RRSP’s Designated Beneficiary for payment?

While it is generally accepted the deceased’s estate is responsible for paying the income taxes that arise from a person’s death, it should be noted that if the estate is insolvent or does hold sufficient assets to pay the estate’s income tax bill, the Canada Revenue Agency (CRA) can require the RRSP’s Designated Beneficiary to use all or a portion of the RRSP’s assets received to pay any outstanding income tax owing by the estate.

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