Why the classic German joint will so often misfires once one spouse is a U.S. person, U.S. resident, or owns U.S.-situs assets
- What the Berliner Testament Actually Is
The Berliner Testament is a joint will of spouses (gemeinschaftliches Testament) governed by §§ 2265–2273 BGB. In its most common form the spouses appoint each other as sole heir (Alleinerbe) on the first death and designate the children (or others) as final heirs (Schlusserben) on the second death. The estate of the first-to-die merges with the survivor’s own assets and passes again on the survivor’s death.Two features make the Berliner Testament structurally different from a typical U.S. joint or reciprocal will: the wechselbezügliche Verfügungen (mutually dependent dispositions) under § 2270 BGB, and the binding effect under § 2271 BGB once the first spouse has died. These are not cosmetic features. They are the engine of most of the cross-border problems described below.
- Pitfall One — The Bindungswirkung After the First Death
While both spouses are alive, either may revoke the joint will by notarial declaration served on the other spouse. After the first death, that freedom collapses. The survivor is bound to the agreed appointment of the final heir and may not, as a rule, alter the disposition by a later will. For couples who later relocate to the U.S., remarry, blend families, or wish to draft a U.S. revocable trust to govern global assets, this binding effect can defeat the entire estate plan. A surviving spouse who executes a Colorado pour-over will and funds a living trust may be inadvertently making void dispositions to the extent they conflict with the German Berliner Testament.
- Pitfall Two — Wasted Allowances Under German Inheritance Tax Law
German inheritance tax (Erbschaftsteuer) is calculated per beneficiary, not per estate. Each child enjoys a personal allowance of currently EUR 400,000 against gifts and inheritances from each parent. The Berliner Testament routes the entire estate through the surviving spouse on the first death; the children inherit nothing at that stage and therefore consume none of their EUR 400,000 allowance against the predeceased parent’s estate. That allowance is forfeited. On the second death the children inherit twice the wealth, but only against a single allowance from the surviving parent.For couples with combined estates above roughly EUR 800,000 — a threshold easily exceeded once Bavarian or Berlin real estate, U.S. brokerage accounts, and retirement assets are aggregated — the lost allowance translates into avoidable German Inheritance Tax at marginal rates that begin at 7 % in tax class I and escalate quickly.
- Pitfall Three — The Mandatory Share Trap
Disinheriting children on the first death (which is exactly what the most common version of the Berliner Testament does) triggers their compulsory share claim under German Inheritance Law — a monetary claim for half of the intestate share, payable in cash by the surviving spouse. This is rarely the result the couple intended. Practitioners typically insert a clause to discourage children from asserting the claim (penalty clause), but these clauses are blunt instruments and frequently fail to deter an estranged adult child or a child whose own household needs liquidity.In a U.S. context, the problem is amplified: an American child of a German parent may have no cultural expectation of waiting for the second death, may live in a forced-share jurisdiction, and may be advised by U.S. counsel unfamiliar with the deterrent function the penalty clause. The result is a mandatory share claim that forces the surviving spouse to liquidate German real estate, often at a structurally bad time.
- Pitfall Four – Choice of Law and the EU Succession Regulation
Under Regulation (EU) No 650/2012 (EuErbVO), the law applicable to succession is the law of the deceased’s habitual residence at death (Art. 21 (1)), unless the decedent has chosen the law of his nationality (Art. 22). A German national couple who moved to the United States and never made an Art. 22 choice may find that Colorado, Florida, or New York succession law governs movables — with German law potentially still applying to German-situs immovables under U.S. conflict-of-laws principles. The Berliner Testament was drafted on the assumption that German law would govern. That assumption is no longer self-executing.A clean choice of law in favor of German law, executed in proper testamentary form, is often the simplest fix — but it must be done before death and must be coordinated with any U.S. estate planning the couple has put in place.
- When the Berliner Testament Still Makes Sense
None of the foregoing means the Berliner Testament is wrong per se. For two German citizens habitually resident in Germany, with German-situs assets, modest wealth, and harmonious family relationships, it remains a sensible default. The cross-border red flags are specific:
- either spouse holds U.S. citizenship, a green card, or has U.S. tax residency;
- the couple owns U.S.-situs real property, brokerage accounts, or retirement assets above the IRC § 2102 (b) threshold for non-residents;
- the couple’s combined estate materially exceeds EUR 800,000;
- there are children from prior relationships, or any expectation that a Pflichtteil claim might be asserted;
- the couple plans to relocate, or has already relocated, away from Germany.
Where any of these factors is present, the Berliner Testament should at minimum be reviewed in tandem with U.S. counsel and, more often than not, restructured — whether through a Vorausvermächtnis to the children, a Nießbrauchslösung, the use of an Erbvertrag with surgical Pflichtteilsverzichte, or a parallel U.S. revocable trust coordinated by an Art. 22 EuErbVO Rechtswahl.
Feel free to contact us to discuss your Berliner Testament at www.germaninheritancelaw.us.
