Italian estate solvency check

Is it safe to accept an Italian inheritance?

Question: I am entitled to inherit an Italian estate. However, I am concerned that the deceased’s debts might exceed the value of the estate. What are my options?

Answer: When you accept an Italian estate by inheritance you inherit all the assets and debts that are part of that estate. Therefore, if you are not sure whether the estate is solvent or not, it is prudent to check it prior to accepting the inheritance.

In this case we usually suggest a couple of options as follows:

a) Claim the estate “with the benefit of limited liability”:

When a person is entitled to claim an inheritance but is concerned with possible outstanding estate debt, the law allows to select a special option to limit the heir liability to the value of the estate. This option in Italian is called “accettare con beneficio di inventario”, which could be translated as a “limited liability estate”.

In order to benefit from such limited liability, the heir shall carry out a rather expensive and time consuming process that is comparable to a bankruptcy procedure. For instance, such process involves the following steps:

• the heir must make a list of all the estate assets and their value;
• the heir must also make a list of all known debts (for example, liens against real estate);
• then the heir must file all the paperwork with the competent court;
• the heir must also notify the court about any decisions and/or actions to be taken with respect to the estate, while managing the estate, to be cleared by a judge.

At the end of this process, when the court verifies that all the debtors have been satisfied, the court can clear the residual estate – if any – for the heir to enjoy it freely.

Unfortunately in Italy the court system works very slowly. As one can imagine, the entire process above might take a significant amount of time and money to deal with the court.

b) Estate Solvency Check privately; then fully claim the estate:
As an alternative to the option above, you can hire a professional to carry out your own private investigation about the estate solvency. In particular, instead of depending on the Italian court system, you can carry out your own investigation to identify:

• the main assets of the estate (e.g., real estate, vehicles, bank accounts, safe deposit box)
• major debts (e.g., liens against the deceased’s registered assets)
• risk indicators (e.g., unpaid checks, involvement in personal businesses with personal liability)

If the results are satisfactory, you can safely claim the estate and liquidate the inherited assets.

The investigation above is surely more time and cost effective than claiming the estate under “limited liability” through the court.

Our Estate Solvency Check service includes as follows:

• Review and complete deceased’s personal profile;
• Check real estate tax record;
• Check real estate title register;
• Check returned (unpaid) checks database;
• Check bankruptcy database;
• Check vehicle title register;
• Check business database (bankruptcy, unlimited liability business);
• Prepare an Estate Solvency Report with the result of our investigation and our legal advice regarding possible options, cost to settle the estate and suggested course of action.

Related information:

• Italian inheritance cost
• Italian inheritance taxes