Does a stepmother have any legal parental status when it comes to inheritance tax ?

robert moon

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I divorced many years ago and remarried 10 years ago. I have 3 sons from my previous marriage. I have 3 apartments that I would like to give them when I die.

Ideally I would like to give everything to my current wife when I die and when she dies she could give the apartments to my sons ( I completely trust her )

As there is no biological relationship between my sons and their stepmother would my sons be liable for inheritance tax ( the apartments are valued at €280k each )
 
Group A CAT exemption applies to bequests from a stepparent to stepchild.
A ‘child’ includes an adopted child and a stepchild.
 
The safer thing to do would normally be to bequeath the property to your sons, subject to her taking what is called a life interest - so they are effectively hers until she dies and then they pass to the sons. It gives her an asset & income stream for life, and limits the scope for things to go sideways after you're gone.

You need to get professional advice.
 
Ideally I would like to give everything to my current wife when I die and when she dies she could give the apartments to my sons ( I completely trust her )
This is VERY unwise. If you wish her to have the financial benefit of them during her life time give her a life interest. You are very naive to not contemplate adverse outcomes. You need interdependent legal advice.
 
You are very naive to not contemplate adverse outcomes.
It can affect the dynamic between her and the children. (Essentially, she can threaten to cut them off.)

Even if she fully plans to honor the request, a falling out between her and one, or more, of the sons could make her change her mind.

The life-interest suggestion eliminates that possible point of friction. Everyone gets the intended inheritance and no friction.

One issue with the life interest can be maintenance of the property.

She would have less reason to maintain it, though giving that she is living in the house, she still has a reason to perform necessary tasks.
 
Or if she remarries, her new spouse would have a claim.
Yeah, he would be entitled to 1/3 of the four houses.

Additionally, she might leave everything to him under the same understanding.

I assume that he wouldn't count as step-father, so the group A thresholds would be lost, even if he honors the plan.

The wise thing to do is to try to match the will to what is actually desired.

What if her mental capacity diminishes with old age?

That could be covered if the two wills are written together (assuming she doesn't change hers).
 
Or if she remarries, her new spouse would have a claim.
If she has a child with someone else later ..... (probably unlikely here, but no ages were supplied) .
One issue with the life interest can be maintenance of the property.
That should be carefully worded in the Life Interest clause in the will. There must be a way to word it so the property is repaired and kept in order.
 
That should be carefully worded in the Life Interest clause in the will. There must be a way to word it so the property is repaired and kept in order.
It's a recognised feature of life interests that they are not good for they property they apply to.

As a matter of law, the life tenant has a responsiblity to maintain the property in the condition in which they receive it, and to carrly out ordinary repairs and renewals — you don't have to stipulate this in the will.

But the brutal fact is that they have no incentive to do this. Any money they invest in the property is eventually going to someone else's heirs, so they tend to be fairly unenthusiastic about doing more than the bare minimum. Plus, a life tenant is usually quite elderly and often has limited income, factors which make them reluctant to undertake decorating work or renovations. And, because they only have a life interest, they can't use the property as security to raise money for any work that they do want to do.

So, if they inherit a life interest in a property with a ten-year old kitchen and a 15-year old bathroom suite and live for 25 years, by the time they die the property has a 35-year old kitchen and a 40-year old bathroom, both of which may have been patched and repaired to keep them functional, but neither of which has been renewed or upgraded. Windows will probably have been repaired as required to keep them weatherproof, but they won't have been replaced and certainly won't have been upgraded. All-in-all, the house will be tired, dated, in need of a lot of work and generally what an estate agent would call a renovator's dream.

And that's the better end of the range of possible outcomes. It's not uncommon for a life tenant to refuse to spend any money on the property, or even to be unable to do so because they simply haven't got it. In this scenario properties can degrade very signficantly.
 
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