Marital Property Regimes in Western Europe and their Effect on the US Estate Settlement
The guide explains how the marital property regime of a couple married under a Western European law determines what the deceased spouse owned, and with it the US gross estate, the marital deduction and the survivor’s basis.
By Caroline Esche Ashford, PhD, JD · Updated in September 2026
In brief.
- The regime decides what each spouse owns. The Tax Court applies the law of the decedent’s last domicile, including its conflict rules, and the estate carries the burden of proving the foreign regime (Estate of Charania, 133 T.C. 122 (2009)).
- France, Belgium, Luxembourg, Italy, Portugal, the Netherlands (marriages since 2018) and Spain, where no regional law displaces it, apply a community of acquisitions by default. Germany and Switzerland use participation regimes that give the survivor a money claim rather than a share.
- The gross estate holds only the decedent’s half of community property (I.R.C. § 2033), and both halves may take a new basis under I.R.C. § 1014(b)(6); a participation regime produces neither result (Angerhofer v. Commissioner, 87 T.C. 814 (1986)).
- The German, French and Canadian instruments allow an elective deduction or credit capped at the applicable exclusion amount, USD 15,000,000 in 2026, in exchange for giving up the qualified domestic trust route.
- Changing a regime is a transfer for US gift tax purposes, taxable above USD 194,000 a year (2026) where the receiving spouse is not a citizen (I.R.C. § 2523(i)), unless a nonresident non-citizen donor transfers intangible property.
The issue
For a couple married under a civil-law system, the titles do not show what the deceased spouse owned. The marital property regime does. Most Western European defaults are community regimes, which make the survivor owner of half of what the couple acquired during the marriage, or participation regimes, which keep each spouse’s property separate and give the survivor a claim at death. The US estate tax reaches only the decedent’s interest and the marital deduction only what passes, so a return prepared from the titles can misstate both, frequently by one half.
Who the guide is for
The guide is written for US estate planners, executors and tax advisors handling the estate of a spouse married in a Western European country, and for notaries and attorneys there whose clients hold US assets, with particular attention to couples who married in one country and later moved to another.
Three families of regimes and the German equalization
The guide states the statutory default of each jurisdiction, including the separation regimes of Austria, England and Wales, Scotland and Ireland. At death the German equalization takes the form either of a one-quarter increase in the survivor’s statutory share (§ 1371(1) BGB) or of a computed claim, and § 5(1) ErbStG exempts a notional claim rather than the increase. Since the Court of Justice decided Mahnkopf in 2018, the track can depend on the law governing the succession.
Which law governs after a move
The applicable law turns on which court is asking and when the couple married. Regulation (EU) 2016/1103, for marriages after January 29, 2019 in eighteen Member States, keeps the law of the first common habitual residence absent a choice. For French, Dutch and Luxembourg couples married from September 1, 1992 to January 28, 2019 without a contract or choice of law, the Hague Convention of March 14, 1978 can substitute the law of a new residence for future acquisitions after ten years or on naturalization. Swiss law applies a new domicile’s law back to the marriage (Art. 55 PILA); a US court looks to the domicile at each acquisition.
The US estate tax consequences
Where the regime is a community, the return reports the decedent’s half of each community asset, and the survivor’s half takes a new basis provided the decedent’s half was in the gross estate, which for a nonresident decedent means US-situs community property only. Joint accounts held with a non-citizen spouse fall entirely into the gross estate unless the estate proves the survivor’s contributions or the community character of the funds (I.R.C. § 2040(a)). The marital deduction and any qualified domestic trust (I.R.C. §§ 2056(d), 2056A) are measured by what passes from the decedent, never by the survivor’s own half; a German equalization claim raises its own characterization question.
The treaty overlay and changes of regime
Where a decedent domiciled in Germany or France leaves a non-citizen spouse, the order is regime, then treaty, then any qualified domestic trust. Both treaties include non-community property passing to the spouse, where the United States taxes it only by reason of situs, in the US base only to the extent it exceeds half of that base (Article 10(4) of the estate and gift tax treaty with Germany; Article 11(2) of the estate and gift tax treaty with France). A notarial change of regime, the German Güterstandsschaukel included, is tested as a possible US gift, and receipts above USD 100,000 from a nonresident alien spouse or foreign estate go on Form 3520.
The questions the guide answers
- Which regime governs a couple who married in one country and died domiciled in another, and who must prove it?
- When does the survivor’s half of community property take a new basis at the first death?
- How is the German equalization computed at death, and how is it treated on the US return?
- How are the marital deduction, the qualified domestic trust and the German, French and Canadian treaty elections measured?
- What gift tax and reporting consequences follow from changing a regime or settling an equalization claim?
- Part I. The threshold determination
- Part II. The three families of marital property regimes and the statutory defaults
- Part III. The participation regimes of Germany and Switzerland
- Part IV. Which law governs the regime of a couple that has moved internationally
- Part V. The US estate tax consequences
- Part VI. The tax treaty overlay
- Part VII. Changes of regime, the gift tax and reporting
- Part VIII. Practice points
The firm determines the regime asset by asset under the conflict rule of the decedent’s domicile, computes what the survivor owns and is owed, and sizes the gross estate, the treaty election and the qualified domestic trust accordingly. Its lawyers hold German law degrees, and some are licensed in Germany. On French law and other European laws, the firm works with the client’s own notaries and attorneys in those countries or with advisors from its network.
Figures for 2026; statuses as of September 2026, as stated in the guide.
This page is general information as of the date stated and is not legal or tax advice. The application of the rules and conventions described depends on the facts of each case.
