Alexander Katzameyer is an expert in inheritance law at JuS Rechtsanwälte Schloms und Partner mbB. Photo: JuS Rechtsanwälte Schloms und Partner mbB
Those who take care of estate planning in good time can save on taxes. In addition to the allowances, which can be used again every 10 years, there are some other tax exemption regulations, for example on the family home. Attorney Alexander Katzameyer from the Augsburg law firm JuS Rechtsanwälte Schloms und Partner mbB reveals the possibilities of transferring the family home to relatives without a tax burden.
What is a family home?
A family home is understood to mean plots of land that have been built on and used by the deceased for their own living purposes, which formed the center of family life. The tax exemption therefore includes the apartment that was actually used by the testator for residential purposes. Second, holiday or weekend seats are not eligible for this benefit. The aim of the regulation is to preserve the family assets and to protect the common family living space.
Tax exemption for the family home when acquired mortis causa
Family homes are generally exempt from inheritance tax, which means that there is a not inconsiderable tax exemption under Section 13 (1) No. 4b, 4c ErbStG. In principle, this privilege can benefit the remaining spouse or the children, but also the grandchildren. With this type of beneficiary, it is important for the heirs to observe the usage period of 10 years. Failure to comply with this deadline will result in subsequent taxation.
Tax exemption through donation
According to § 13 I No.4a ErbStG, donations of family homes during lifetime between spouses and registered life partners are also tax-exempt. The grant can include sole or joint ownership and is independent of the value of the property.
In contrast to acquisition mortis causa, there is no period of self-use here, i.e. the tax exemption does not apply if the family home is sold or no longer used. On the other hand, the group of people is significantly smaller than in the case of inheritance, since only spouses or life partners can receive gifts tax-free.
What must absolutely be considered?
In addition to the 10-year retention period for acquisitions mortis causa and the smaller group of beneficiaries for donations during one’s lifetime, it must also be considered that there can only ever be one family home. It may therefore be advisable to choose the most valuable property as your home.
Since the tax exemption is a valuable benefit and both options offer their advantages, it is advisable to seek legal advice in good time. This is the only way to find the optimal solution for you and avoid unwanted surprises.
