Police, fire and ambulance services were called to his home in Ottawa Thursday afternoon. Police outside the building asked reporters to move aside from the door "out of respect" for family members.
MPs suspended the House of Commons just before the daily question period, around 2:15 p.m. ET, as news of Flaherty's death made its way through Parliament Hill.
Cabinet ministers going into the House declined to comment. Some looked emotional as they passed the usual throng of journalists.
Opposition MPs crossed the floor to shake hands with Conservative MPs and offer their condolences.
Officials briefed Prime Minister Stephen Harper, who had been scheduled to make a joint statement with the visiting president of Peru.
Flaherty stepped down from cabinet less than a month ago, citing a plan to return eventually to the private sector.
He had spent more than a year publicly battling health problems.
Until he stepped down last month, Flaherty was the only finance minister to serve under Prime Minister Stephen Harper.
More to come