When parents become in need of care and can no longer cover the costs of a nursing home or extensive care from their own retirement benefits, long-term care insurance, and available assets, many families face a difficult question: Do the children have to step in financially? The answer is: in principle, a duty to provide support may exist, but only under certain conditions. There is no automatic liability on the part of the children for all nursing home or care costs.
Under German law, direct lineal relatives are obligated to support one another. This means not only that parents must provide for their children, but also, in certain cases, that adult children may be obligated to support their parents. This obligation is referred to as parental support and can become particularly relevant when a parent can no longer cover the costs of care on their own.
In practice, the social welfare agency often initially covers the uncovered long-term care or nursing home costs if the income and assets of the person in need of care are insufficient. The social welfare agency then assesses whether children obligated to provide support have the financial means to do so and whether recourse to them is even an option. Since the enactment of the Family Relief Act, a significant relief measure has been in place: In principle, recourse to a child’s income is only made if their annual income exceeds 100,000 euros.
This income threshold is the decisive factor for many families. If a child’s gross annual income is less than 100,000 euros, the social welfare agency generally does not consider claiming support from them. Only when this threshold is exceeded does the actual assessment begin to determine whether and to what extent parental support must actually be paid. Consumer information also indicates that, since the beginning of 2020, children can only be held responsible for the care of parents in need of care if their annual gross income exceeds 100,000 euros.
It is also important to note that, as a first step, the income of the child’s spouse is not taken into account. The question of whether the 100,000-euro threshold has been exceeded generally depends on the child’s own income. However, when it comes to the actual calculation of support, the family’s financial circumstances and the marital living arrangements may indirectly play a role.
Before children are called upon to provide support at all, parents must generally first use their own resources. These include, in particular, current income, pension entitlements, benefits from long-term care insurance, and available liquid assets. However, there are protected amounts and assets that do not have to be touched without further consideration. This so-called “protected assets” is intended to ensure that the parent in need of long-term care can continue to meet their basic living expenses.
Special attention should be given to gifts that parents made in the years prior to becoming in need of long-term care. Under certain conditions, gifts made within a ten-year period may be reclaimed in whole or in part. The rationale behind this is that transfers of assets should not result in the general public or relatives obligated to provide support having to bear costs, even though liquid assets were still available at the time.
However, exceeding the income limit does not automatically mean that the child must cover all uncovered nursing home or long-term care costs. A detailed assessment of the child’s personal financial capacity follows. This takes into account the child’s own obligations, ongoing financial burdens, and necessary expenses. Support obligations toward the child’s own minor or adult children, obligations toward a spouse, reasonable retirement savings contributions, as well as certain loan or housing costs may be relevant here.
Therefore, not simply the entire disposable income is taken into account. Rather, an income relevant for maintenance purposes is determined. Subsequently, it must be assessed what amount must remain available to the child. Particularly in the case of parental support, it is taken into account that the adult child has typically already established a life of their own, with their own family, their own life plans, their own retirement savings, and possibly their own real estate purchases.
Anyone whose income is close to the 100,000-euro threshold should proceed with particular caution. Even communication with the social assistance agency can have legal implications. Before providing extensive information on income, assets, or family circumstances—or even making payments prematurely—one should verify whether there is actually an obligation to disclose such information and what details are required.
Exceptional circumstances may also play a role. In special cases, it may be necessary to determine whether a hardship situation exists or whether circumstances from the family’s past affect the obligation to provide support. Such questions cannot be answered in general terms. The specific family, financial, and legal circumstances are always decisive.
For many children of parents in need of care, the current legal situation provides significant relief. In many cases, the concern that one will automatically be held liable for high nursing home costs is unfounded. Nevertheless, the situation should not be underestimated if one’s own income exceeds the statutory threshold or is expected to reach that threshold in the foreseeable future.
It therefore makes sense to seek legal advice early on, as soon as it becomes apparent that a parent may need long-term care or if the social services agency has already requested information. This allows you to clarify whether you are at risk of being held liable at all, what documents must be submitted, and what deductions must be taken into account in your specific case. Particularly in the case of parental support, the exact calculation often determines whether a payment obligation exists and, if so, in what amount.
The statements represent initial information that was current for the law applicable in Germany at the time of initial publication. The legal situation may have changed since then. Furthermore, the information provided cannot replace individual advice on a specific matter. Please contact us for this purpose.