Protecting the Assets Donated to Children is a Common Concern Among Parents Who Wish to Ensure the Financial Stability of Their Descendants.
Brazilian law offers several ways to guarantee this protection, preventing donated assets from being squandered or lost due to the beneficiaries’ personal issues, such as debts or divorces.
Restrictive Clauses One of the most effective ways to protect donated assets is through the inclusion of restrictive clauses in the donation deed. The main clauses used are:
- Inalienability: prevents the donated asset from being sold or transferred to third parties, protecting it against voluntary alienation.
- Unseizability: protects the asset from being seized due to debts incurred by the donee.
- Non-communicability: ensures that the asset does not become part of the spouse’s estate, preventing it from being divided in the event of a divorce.
Donation with Reservation of Usufruct Another common strategy is donation with the reservation of usufruct. In this case, parents donate the asset but retain the right to usufruct, meaning they continue to have the right to use and enjoy the asset until the end of their lives. After the parents’ death, full ownership is transferred to the children. This ensures that parents maintain control over the asset while they are alive.
Estate Planning Estate planning is an essential tool for asset protection. It can be accomplished through wills, the creation of family holding companies, or trusts. These structures allow for a more efficient organization of assets, reducing the tax burden and ensuring the preservation of wealth.
Prenuptial Agreements To ensure that assets donated to children are not divided in the event of a divorce, it is possible to draft prenuptial agreements or cohabitation pacts, stipulating that donated assets will not be included in the regime of community property.
Final Considerations
Protecting assets donated to children requires planning and knowledge of the law. Restrictive clauses, donation with reservation of usufruct, estate planning, and prenuptial agreements are some of the tools available to ensure that donated assets remain protected and fulfill their purpose of providing financial security to future generations. Seeking guidance from a specialized attorney will help you understand all the available options and choose the best strategy to protect family assets. Well-prepared planning can avoid future disputes and ensure peace of mind for both donors and beneficiaries.