Hofmann & Fertig advises high net worth individual with respect to the structuring and tax neutral transfer of various real estate assets under anticipated inheritance (vorweggenommene Erbfolge).
In order to structure the transfer of the real estate assets properly the value of the real estate was determined for gift tax purposes pursuant to the Valuation Tax Act. Taking into account that the values of the real estate exceeded the tax allowances available for the three children, the real estate assets were separated between the families of the three children, whereby each of the three children set up a private asset management partnership (vermögensverwaltende Personengesellschaft) with their own children. The interest ratios in the partnerships were determined in a way that the (remaining) tax allowances available for the children and grand-children were not exceeded, with the effect that the transfer of the real estate assets did not trigger any (gift) taxes. Also due to tax exemptions available, also no real estate transfer taxes became due.
The structure established among other things has the benefit that the management of the partnerships, the withdrawals of proceeds as well as conditions to make decisions can be determined to meet the individual needs of the families.