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Many parents of retirement age are considering passing their homes on to the next generation early. Some people on the Observer’s advice line want to know how to do this. Others worry that authorities will take away the children’s home if the parents are forced to move into an expensive home later. For many Observer members, treating children equally financially is important. But: How does this work?
Before parents dive into the jungle of legal aspects, it’s best to call a family table. It is important that children’s and parents’ ideas are collected and discussed. Do children even want to take over the parental home? Is only one interested? Do parents still want to stay at home?
Sometimes no child is interested in taking over. Sometimes more than one child shows interest at the same time. Or it turns out: taking over the next generation prematurely is not a smart idea at all.
Hassle-free sale at market value
If a child wants to inherit property, it is important to know all the legal issues involved. This is the best way to prevent conflicts between siblings and remove obstacles from parents. Parents and children should also consider the tax consequences with tax authorities in advance.
If a child buys the property from his parents at the current market value (= market value), there are almost no problems. Parents receive the full equivalent value and therefore siblings receive equal treatment in inheritance law. And if the parents’ financial situation is no longer sufficient to support themselves later, supplementary benefits (EL) often make up for the gap.
Misconceptions about additional benefits from parents
If parents give the property to a child or the price is significantly below market value, it is best for the parents to agree with all children on whether and how the gift will be resolved under inheritance law. For this, an inheritance contract must be made at the notary.
Parents often want to pass their property on to their children so that they do not have to use it for an expensive nursing home later. There are always the same mistakes and half-truths floating around on this subject. Contrary to popular belief, when it comes to receiving additional benefits, the gift does not expire after ten years.
In fact, the situation is this: Parents do not receive any additional benefits if they have donated too much wealth. Then you need to get benefits. This controls whether children need to provide relative support. But they only have to do this if their financial situation is very good. Financial contribution to the living expenses of needy parents is owed only in exceptional cases. Likewise, children do not have to return the goods they bought to their parents if necessary.
Source : Blick
I am Dawid Malan, a news reporter for 24 Instant News. I specialize in celebrity and entertainment news, writing stories that capture the attention of readers from all walks of life. My work has been featured in some of the world’s leading publications and I am passionate about delivering quality content to my readers.
