What is better to draw up – a gift deed or a will?

Often, when owning a car, business or real estate, parents and relatives ask themselves the question: which is better: a will or a gift? Everyone wants to properly manage and divide their inheritance. Of course, in resolving this issue you should contact a lawyer or notary who can provide professional assistance.

However, first, you need to independently understand the pros and cons of each inheritance procedure. So, let's look at the basic concepts.

A deed of gift is a drawn up gift agreement, which includes the gratuitous transfer of property into the ownership of another person, regardless of family ties.

A will is a unilateral agreement or expression of the will of a citizen in which he disposes of his property in the event of death, indicating heirs.

Main differences between deeds of gift and wills

Let's look at the difference between a deed of gift and a will.

So, which is better: a will or a deed of gift for an apartment, house or real estate? A will represents a safe transaction for the testator, since he can change or supplement the document at any time. However, a deed of gift is the most profitable transaction for the donee, therefore it is very difficult to challenge a deed of gift.

It is important to remember the challenge that a will poses. The heirs will have to share their property with a group of people who, regardless of whether they are included in the agreement or not, have the right to a share in the inheritance: children under 18 years of age, disabled people, retired parents.

Who and how can cancel a will and donation of an apartment or house?

Let’s say you decide to help a lonely elderly person and are ready to help him financially, transfer small sums of money, buy food, pay for utilities, treat him, and just communicate with him. In response, you want to receive housing after the death of the ward. The owner agrees with your condition and offers to write a will in which you are indicated as the sole heir of the apartment.

What could be better? But what could happen next in such a situation? Years will pass, you will regularly fulfill your obligations to support the ward, but he will age even more, perhaps his mind will become clouded, suspicion and mistrust will appear, and, as a result, he will simply go to the notary’s office and cancel (change) the will drawn up earlier, excluding You as the heir from it. Does the law provide for the described scenario? Certainly!

The testator can cancel and change the will at least every month according to his mood, and nothing can limit him in this. In addition, such an heir may subsequently have relatives who will influence the heir and encourage him to take such actions.

How will the situation develop if you draw up a gift agreement with your ward, indicating in its text a link to your right to live in this residential premises indefinitely? Is it possible to cancel a concluded contract, and who can do this? Yes, and here an unfavorable development of events is possible, but it will be very, very difficult. For example, provided that the donor did not realize the significance of his act due to any illness, he or his relatives can at any time file a claim in court demanding that such an agreement be declared invalid and the property donated to you be returned to its original owner. In the courts, such processes occur very rarely, however, if the donor has actual illnesses at the time the transaction is concluded, such transactions are declared invalid by the courts. But this option is still much better.

So in 2020, what is better and safer in such cases for the party receiving a house or apartment in exchange for the maintenance of the previous owner? Nothing! In this case, I would recommend using a married annuity agreement, or rather its variety - a lifelong maintenance agreement with dependents. Under such an agreement, the rent recipient gives the house or apartment he owns as ownership to the rent payer, and in return, the rent recipient is maintained by the rent payer under the conditions stipulated by the signed document. With this form of relationship with the ward, you will become the owner of the apartment immediately after registering the agreement, but your property will be limited, and you will be able to dispose of such real estate (sell, donate, mortgage) only after the death of the annuity recipient.

If you regularly support the elderly person and strictly adhere to the terms of the contract, neither its former owner nor his relatives will be able to take back the residential premises. This type of transaction is also better for a citizen transferring his apartment to a new owner. If the rent payer is caught dishonest and evades the maintenance of the ward, the latter can always terminate the agreement and return his apartment back.

Is a will better and more profitable than a deed of gift?

If you have a question about transferring your real estate to relatives or third parties without any reciprocal actions on their part, but simply for the purpose of giving the citizens you have chosen the right of ownership to the property that belongs to you, then in this case in 2020 it is more profitable to choose an agreement donations if the donee is a close relative.

To transfer property to citizens who are not relatives, it is financially more profitable to bequeath it in 2020. Here the presence of personal income tax plays a big role in the option of donating to non-relatives.

How to formalize a gift deed or make a will?

If you decide to re-register an apartment or house by donation, you can either draw up such an agreement yourself, using standard samples from the Internet, or seek legal assistance from a lawyer who will not only prepare the text of the document itself, but also generate all the necessary documents for the transaction, and will also accompany her. The same services can be obtained by contacting any real estate agency, but the price for a real estate registration service in a real estate company will be much higher than a similar service from a lawyer or attorney.

When choosing the hereditary option of securing rights to housing, you should contact any notary office to obtain preliminary consultation and agree on the time of notary service.

Lawyer Gennady Efremov

Making a will

In order to determine how best to formalize an inheritance: a will or a deed of gift, you need to know some conditions.

Let's determine what is required to draw up a will:

• A clearly formulated will of the testator. The testator should clearly convey in writing his will regarding the division of the inheritance so that there is no ambiguity or misinterpretation of his words. Also, the document must be drawn up in accordance with all legal requirements.
• Determine the share of each heir. A clearly defined portion of the inheritance for everyone will eliminate unnecessary disputes. In resolving this issue, it is better to avoid using common property. If there are several heirs, then it is better to determine a specific heir or his share in the inheritance for each property.
• Substitute heirs. The testator can take care of who will receive his property in the event of the death of the direct heir. This option can also be used if the heir renounces his share of the inheritance. The right of designated heirs comes into force before and after the opening of the right of inheritance.
• Appoint an executor of the will. This item is necessary for the safety of property. For example, the immediate heir lives far away and cannot immediately take back his share of the property: a car, equipment, securities or jewelry. Offended heirs living nearby may illegally take away the assigned share. To return the inheritance “lost” in this way subsequently becomes almost impossible. Therefore, it is better to take care of the Executor, who can be a notary or a lawyer; he will legally give the assigned property to the heirs under the will. All powers of the will executor must be specified in the document.

What is more reliable: donating or bequeathing?

If we touch upon the legal and interpersonal aspects of legal relations, both deeds of gift and wills have their positive and negative sides.

• Today there is no tax when drawing up these contracts, but until 2005 it was charged. Is there a guarantee that the authorities will not introduce it again? If you plan to transfer property to a close relative, draw up a deed of gift. After all, by the time the will is implemented, a tax may be introduced that will “eat up” a significant part of the inheritance.
• Do you want to transfer property to one relative, but there are other legal successors with the right to a compulsory share (a minor child, a retired spouse or a close disabled relative)? Prepare a deed of gift. If there are incapacitated relatives, the inheritance mass will be divided taking into account their share. And it doesn’t matter at all whether you want to leave them an inheritance or not. The obligatory share is 2/3 of the inheritance to which they could claim by law.

Let's give an example: the testator has a brother and an adult disabled daughter from among his closest relatives. In accordance with the law, after his death they will both inherit the property in equal parts. However, the testator wants to transfer the apartment to his brother, since he has not communicated with his daughter for a long time. Even if he draws up a will in favor of his brother, the daughter will then receive her share - 2/3 of half of the inherited property.

• If you have a long line of heirs lined up, but you want the property to go to one person, also enter into a gift agreement. His relatives cannot annul. And it is not difficult to challenge a testamentary document. The courts are inundated with claims from failed heirs. Offended applicants provide evidence that the testator was psychologically pressured by happier heirs, the testator used medications, suffered from alcoholism, or simply was not aware of his actions, suffering from senile insanity. And if the testator was elderly or ill, the likelihood of the document being invalidated is quite high. In addition, the courts on applications of this category drag on for more than one year, “facilitating” the heirs with money and taking away their time.
• But from another point of view, there are often cases in life when gentle, loving and caring grandchildren hand over their beloved grandparents to nursing homes as soon as they sign a deed of gift. Having executed the contract, you will lose all rights to the apartment and will have to vacate it at the first request of the new owner. In this case, the best option is a lifelong maintenance (annuity) agreement. This is especially true if you plan to transfer the property to third parties in the future.

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Registration of deed of gift

To sign the deed of gift, you will need to collect the following list of documents:

• Personal data of the parties to the agreement. Document registering a citizen, marriage certificate.
• Written agreement. Each participant in the deed of gift must have a copy of the agreement. It will also be necessary to have an additional copy for the Justice Department. If you are drawing up a deed of gift for land or a residential building, you will need two more copies.
• A check with payment of the assigned duty. This is a mandatory payment, which includes payment for registration to receive possession of the property.
• Cadastral document from the BTI.
• A document confirming the registration of the right to property of the donor himself.

If both spouses have the inheritance, then the written consent of the spouse is required when concluding a deed of gift.

In the case where the inheritance is owned or children who have not reached the age of majority live there, it is necessary to obtain permission to register a deed of gift from the department of guardianship and guardianship of children.

What is a deed of gift?

The deed of gift is a two-sided document. This is an agreement where one party donates an object and the other party accepts it. An essential condition is that the transaction is free of charge.

The gift passes to the new owner during the life of the donor. This fact is formalized through state registration with the Rosreestr authority. Thus, the property specified in the deed of gift becomes the possession of the recipient during the life of the donor.

A gift agreement can only be canceled in exceptional cases through a court decision.

How is a deed of gift made?

To transfer property under a gift agreement, the following algorithm of actions is used:

1. Preparation of documents necessary for filling out the deed of gift and subsequent registration of the transfer of ownership rights. These are the passports of the parties, title documents for property, an extract from the Unified State Register of Real Estate, the notarized consent of the spouse to the transaction, and other documents as appropriate.
2. Drawing up a gift agreement.
3. Registration of the transfer of ownership with the Rosreestr body. If the agreement is notarized, then with the consent of the parties, the notary can send all the documents necessary for registration to Rosreestr, signing with his electronic signature.

What is cheaper: drawing up a deed of gift or a will?

When thinking about transferring property, everyone wants to do it with the least financial cost.

It is important to know that when registering a gift of property to a person who is not a relative, the law requires you to pay tax. Under a will, such tax is not paid.

Therefore, for the heirs of the first stage, the question of what is cheaper does not play a significant role. Representatives of the first stage include:

• Husband or wife.
• Parents of each spouse.
• Children.
• Parents who adopted children.
• Children who have been adopted.
• Grandfathers and grandmothers.
• Grandchildren.
• Siblings, as well as children who have the same father or mother.

For future owners who are not related or are distant relatives, it will be cheaper to draw up a will.

Comparison of two papers

What is more profitable in registering an inheritance?

No specialist can give a definite answer to this question: which is better: a deed of gift or a will for a house? The decision must be made based on the situation.

If we talk about the heir, then it is beneficial to draw up a will.

A will can be revoked or radically changed. From the legal side, only the last expression of will comes into effect. Also, the property remains in full possession until the last breath. A person will receive ownership of the property only after the death of the testator.

It is more profitable for the heir to draw up a deed of gift.

It is almost impossible to challenge a gift document and the property automatically passes into the possession of the recipient. He has the right to dispose of the property after registration of the agreement. If we talk about a will, then the right of inheritance is received only six months after the death of the testator.

Video: Which is better, a deed of gift or a will?

Pros and cons of gift agreements and wills

Advantages and disadvantages of deed of gift:

• When drawing up a deed of gift, the donor must remember that it will be necessary to rewrite it
• The “irreversibility” of the process protects the rights of the heir from possible “changes of mood” of the donor.

Advantages and disadvantages of a will:

• A will can be adjusted by the testator. The will can either be rewritten completely from scratch or supplemented with new details: change the share of heirs, cross out old ones and add new ones, prescribe the conditions for transferring the inheritance, appoint your own executor, and so on.
• Even if the testator transfers the property to one heir, part of it will still go to legal relatives: elderly parents, incapacitated relatives or minor children.

How are they different from each other?

A will and a donation have different legal natures, although the result of these actions is the transfer of property to third parties. Speaking about their differences, but without delving into theoretical issues, we should pay attention to the timing associated with the moment of transfer of law.

Will

Citizens have the right at any time to make decisions regarding the fate of their property after death by drawing up a will. Moreover, even after drawing up the relevant documents, he remains its owner and can further dispose of it at his own discretion. The heirs may not even know about it. In addition, there is such a thing as the “secrecy of a will.”

The inheritance opens only at the time of the citizen’s death. After this, the document comes into execution. The heirs can either accept the property or refuse it. The transfer of rights itself can be registered with the registration authorities only after 6 months have passed from the time of death of the person.

Gift deed

The donation is in no way connected with the inheritance and the procedures accompanying it, including those related to timing. Thus, after signing the relevant document, the parties can contact the registration authority to re-register ownership.

After the contract comes into force, the new owner can dispose of the property at his own discretion, regardless of whether its previous owner is alive or dead. The latter completely loses the ability to use and dispose of it.

Is it possible to cancel or change a gift agreement or will?

A deed of gift is not a simple contract. It is very difficult to rewrite or cancel.

Expert opinion

Natalia Volkova

Inheritance expert

Ask me a question

Only the judge has the authority to challenge the document. This will require a lot of effort. After all, you need to prove a number of facts. For example, the incapacity or mental insolvency of the donor, or the presence of the fact that the signing of documents at the time of donation occurred under threat to well-being and health, or psychological pressure was exerted on the donor.

There are 2 situations that have the legal force to invalidate a transaction:

1. The recipient does not take care of the gifted item and treats it in an unacceptable manner. Such actions carry the threat of irreparable loss.
2. The donee had the intent to harm the health or life of the donor, or there was an attempt on the life of family members.

The will can be rewritten or amended at any time, new heirs can be added to it, or the shares of the transferred property can be distributed differently.

It is important that each new document execution cancels the previous one.

What is a will

Current Russian legislation determines that a person’s property in the event of his death can be transferred to third parties by inheritance. Actually, there are two forms of such transfer: by law and by will.

In the first case, the inheritance will be distributed among the closest relatives, the list of whom, as well as the order of inheritance, is directly established by law.

In the case of a will, a person can independently determine the circle of his heirs. These may not necessarily be his relatives. It is permissible to indicate any persons in a will, since it most fully expresses the will of the testator.

It should be taken into account that the law specifically protects the rights of the most socially vulnerable citizens. In this regard, it is necessary to separately identify persons whose right to the inheritance mass arises regardless of the will of the testator. These mainly include those citizens who were dependent on the latter at the time of his death.

Thus, a will should be understood as a form of expression of the will of a citizen regarding the disposition of his property after his death. An important aspect of this act is its execution in the form prescribed by law.

Reference! In addition, the document itself is called a will, which, in fact, reflects the will of the citizen on this issue.