The Starting Point: Two Legal Systems
An estate connected to both Germany and the USA is one of the most demanding constellations in international succession law. Typical cases: a German resident owns assets in the USA, or a US citizen leaves accounts, securities or real property in Germany. In every case, two fundamentally different legal systems must be coordinated.
On the European side, the EU Succession Regulation (EuErbVO) sets the framework. It answers three questions: which court has jurisdiction, which national law applies, and how decisions and certificates are recognized across the border.
Which Law Applies? Habitual Residence
Under the EU Succession Regulation, succession is generally governed by the law of the country where the deceased last had their habitual residence – the place where they actually led their life (Art. 21). Unlike the old German rules, nationality alone is no longer decisive.
Habitual residence is determined by an overall assessment of the final years of life: duration and regularity of the stay, family and economic ties, and the reasons for the stay. The aim is a particularly close and stable connection to one country, so that a short move does not immediately change the applicable law.
The USA as a Third State – and Domicile
The USA is not a member state of the EU Succession Regulation. Each US state therefore counts as a "third state," and there is no uniform US succession law – Florida, New York and California each have their own rules. The correct state must be identified first.
Where the Regulation points to US law, that state's conflict-of-laws rules must also be considered (renvoi). US conflict law ties movable property to domicile – the permanent center of life. Domicile is close to, but not identical with, habitual residence. This step decides which substantive law ultimately governs.
Estate Splitting: Movable and Immovable Property
While German and European law follow the principle of a unified estate, US law follows the principle of splitting: immovable property, in particular real estate, is governed by the law of the state where it is located (lex rei sitae). Movable property follows the law of the domicile.
A single estate can therefore split into several partial estates governed by different laws – for example real property in Florida, a US brokerage account, and at the same time accounts and real estate in Germany. German and US proceedings must then run in parallel and be carefully coordinated.
No Forced Heirship? Testamentary Freedom and Ordre Public
German law protects close relatives through the compulsory portion (Pflichtteil) – a minimum share even against the testator's will. Many US states do not recognize such a forced share for children; disinheritance is often possible there. Usually only the surviving spouse has a statutory minimum right (elective share).
A missing forced share under US law is not automatically corrected. As early as 1992, the German Federal Court of Justice accepted that under Florida law a descendant has no compulsory portion – no violation of German ordre public was found. Only in exceptional cases can a result be corrected via ordre public (Art. 35). Those who want to protect their children should therefore plan early.
Choice of Law: The Most Important Planning Tool
The Regulation allows a testator to choose, by will, the law of their nationality (Art. 22). In German-American cases this is the central lever: a German resident in the USA can choose German succession law and secure the children's compulsory portion; a US citizen in Germany can choose the law of their US home state. Only one home law may be chosen – not an arbitrary law.
Probate and German Certificates of Inheritance
In the USA the estate does not pass automatically to the heirs as it does in Germany. Instead a court-supervised probate process usually applies: a court-appointed personal representative (executor with a will, administrator without) manages the estate, settles debts and taxes, and only then distributes the remainder.
A German certificate of inheritance (Erbschein) is not automatically recognized in the USA but can be submitted as evidence. Conversely, US documents (e.g. Letters Testamentary) must be prepared for use in Germany. As a New York-admitted attorney, Dr. Barandt can handle both sides directly.
Taxes: Estate Tax and German Inheritance Tax
Both the US federal estate tax and the German inheritance tax can reach the same estate. The estate tax taxes the estate as a whole – for non-residents with only a small exemption on US assets. German inheritance tax attaches to each individual recipient and grants exemptions graduated by degree of kinship.
The German-American double taxation treaty mitigates a double burden, but its application requires precise knowledge of both tax systems. As a Certified Specialist in Tax Law and Certified Public Accountant (C.P.A.), Dr. Barandt coordinates both tax returns from a single source.
Wills and Form
The formal validity of a will is connected separately (the 1961 Hague Convention on the form of testamentary dispositions, or Art. 27). A will valid under the law of the place where it was made is recognized. US wills usually require witnesses; a purely handwritten will without witnesses ("holographic will") is valid only in some US states. In German-American cases the form should therefore be checked carefully.
How We Proceed – Step by Step
- Characterization: is the question one of succession law at all?
- Determine the applicable law: is there a choice of law? Otherwise habitual residence (Art. 21).
- Check renvoi – almost always relevant in US cases because the USA is a third state.
- Identify the correct US state and its domicile rules.
- Account for estate splitting: situs law for real estate, domicile law for movables.
- Coordinate taxes: align estate tax and inheritance tax under the treaty.
- Review the outcome and, if necessary, correct it via ordre public.
Our Services
- Determining the applicable law in US-connected estates
- Representation before US probate courts
- Recognition of German inheritance certificates and wills in the USA
- Administration of split estates (real property, brokerage, accounts)
- Choice-of-law drafting to secure the compulsory portion
- Coordination of US estate tax and German inheritance tax
Frequently Asked Questions – Inheriting from the USA
Which law governs if the deceased lived in the USA?
Under the EU Succession Regulation, succession is generally governed by the deceased's last habitual residence. If that was in the USA, US state law applies – but via renvoi the US conflict rules and possibly domicile must also be considered. Real property always follows the law of the state where it is located.
Do I have a compulsory portion as a disinherited child if US law applies?
Many US states do not recognize a compulsory portion for children. In 1992 the German Federal Court of Justice accepted a complete exclusion under Florida law. Only exceptionally can a result be corrected via ordre public. A timely choice of German law, however, can secure the compulsory portion.
Will my German certificate of inheritance be recognized in the USA?
Not automatically. It can, however, be submitted as evidence in the US proceedings. As a New York-admitted attorney, Dr. Barandt can pursue recognition of German inheritance documents before US courts and authorities directly and arrange the transfer of US assets to the German heirs.