The book “Herencias Felices” by Alejandro Ebrat Picart, published by Deusto, is the best in its field. It offers us the information we need to effectively manage our family inheritances, making the best decisions to obtain the best economic result. It focuses on the two most controversial points of an inheritance: family problems and the taxes to pay.
What causes an “unhappy” inheritance?
The first theme is the struggles between the heirs; It must be said that the inheritances are conflicting in a very high percentage, 90%. The happy inheritance, one in which everyone is happy with what they have been given, is difficult to donate. When family politics enters, husbands, wives and their children are already involved. This is one of the two big reasons for the unfortunate legacy, the struggles among children. The second big block is the question of the taxes we have to pay.
What reasons lead to quarrels between children?
The main reason is lack of distribution. That is to say, children should be given well-chewed things and, if possible, specifically assigned goods, as far as possible. Because at the moment of distribution it is when they argue: “I want that, I want the other.” Unhappy legacy is the deceased’s fault because he didn’t do things right. I always say that the fault lies with the deceased himself, for not having made a precise designation of the assets in his will.
What happens if we die without leaving a will?
This is drama. First, because what is established by law is inherited. And in common law if you don’t have children, the parents inherit on the spouse in most of the autonomous communities, except in Catalonia and Galicia. And dying without a will is even more expensive. And then there’s the biggest problem and that’s not having cast. A third problem that we find ourselves with is that older people are forced to make wills, that’s what we call capture. For example, the person in the company takes the elderly person he takes care of, and who no longer knows anything, takes him to a notary and has him make a will in favor of that person. Or a son who takes him to live in the house and what a coincidence that when he dies the will is in favor of the son he lived with. Contesting a will is very difficult, you need a series of proofs.
What are the most controversial issues in inheritances?
When they tell us: I don’t want the inheritance to go to my son-in-law or daughter-in-law. This is very typical. But there are mechanisms in the will itself to ensure that this never happens. Another controversial issue is that of the legitimate: depending on the autonomous community in which one lives, there is a part, the legitimate one, which necessarily goes to the children. Well, here you have to specify what you leave as legitimate, because if they don’t take what they want, that’s why you have to specify and be very aware of the legitimate ones, what is involved in each region. In most communities it is two-thirds.
Is it better to donate while alive or wait for the inheritance?
It depends on the community because it depends on taxes. Regardless, I advise live children to “no water.” How come? First, because your children will divorce, because two out of three marriages in Spain do, and when your child divorces, the ex or ex will keep the apartment or vice versa. Secondly, because in general, giving during life costs more than inheriting. And thirdly, because children are subject to economic risks that we no longer have at our age, they ask for a mortgage, a loan, that is, they risk losing money.
And from a fiscal point of view, is it better to donate while still alive or wait for the inheritance?
From a fiscal point of view, there are communities in which it is better to donate alive because taxes are not paid and the advantage of donating alive is that you have already distributed and there will be no disputes, and you get rid of the inheritance tax because you empty your assets . You have to analyze everything, see if he pays or not, but even so, I’m not a big fan of living donations.
What is the most delicate part of an inheritance?
The hereditary partition, making the parties when the deceased did not. Get everyone to an agreement, who gets what, because you have to avoid the undivided, you leave two houses to three brothers and then the grandchildren kill each other. Sometimes a son dies and it turns out that you find yourself jointly owning your brother’s sons. If the lots cannot be established, there are mechanisms whereby if in a year the parties do not agree, for example, on the sale of a house, this ends up being sold.
What do you recommend to design the inheritance process?
First the drafting of the will and then the planning of the inheritance. I always recommend contacting an expert inheritance lawyer who studies the patrimonial situation of both spouses, who analyzes it and draws up a drawing of that inheritance, starting from the basis of their family situation to avoid problems. Then a succession strategy from a tax point of view is worked out. Not only do we design wills, we also do estate strategies for 20 years, for example making donations little by little to pay less taxes. What I recommend is farsightedness and then you can change, because the personal relationships between parents and children change, as well as financial relationships. I could have sold a house, bought a new one, gotten a divorce… People come to me with wills from 40 years ago.
What can we do if we expect inheritance to conflict?
I recommend appointing an executor, preferably a lawyer, a trusted person to whom you can give directions. He will be my other self when I’m gone and he will also have the power to disinherit children.
