Anyone who transfers his or her assets to the next generation upon death, either by will or by intestate succession, must reckon with the fact that high inheritance taxes could be imposed on the heirs. It is not uncommon for heirs to be forced to encumber or sell inherited real estate in order to be able to settle the tax claim. The good news: Inheritance taxes can be avoided in the vast majority of cases if parents seek advice on how to transfer assets to their children or grandchildren during their lifetime. Real estate transfers are a good way to do this, as the transferors can reserve far-reaching rights to use the real estate. Furthermore, it can be ensured that the donees cannot encumber or sell the property, that the property does not fall into a possible insolvency estate or that the children’s creditors cannot access it, and much more. It is also possible to have one’s children promise care and life annuities in return, or to obtain a waiver of a compulsory portion. As a result, the transferor can be protected in such a way that he is hardly in a different position than he was before, when he was still the owner, or even better as a result of the consideration. And the transferor only has to go to unloved owners’ meetings if he still wants to.
By transferring real estate during life, you save your heirs (high) inheritance taxes and at the same time ensure peace among the heirs, since the real estate can no longer become part of an inheritance dispute. In addition to the tax advantages, gifts of real estate can also reduce compulsory portion claims of unloved children and prevent the recourse of the social benefits agency, which bears the costs of a nursing home in old age.
Therefore, every real estate owner is strongly advised to seek advice on the possibilities of anticipated succession.
