French inheritance tax (succession tax France): A complete 2026 guide for US expats

France levies succession tax – droits de succession – on assets transferred at death. Rates range from 5% to 45% for direct descendants and up to 60% for non-relatives, depending on the heir's relationship to the deceased and the value of the estate.

French inheritance tax applies to worldwide inherited assets when the deceased was French tax resident. If the deceased was not French tax resident, France also taxes worldwide inherited assets received by a beneficiary who is French tax resident on the transfer date and was French tax resident for at least 6 of the prior 10 years. Otherwise, France generally taxes French-situated inherited assets, subject to any applicable treaty.

The tax is paid by each individual heir based on their share, not by the estate as a whole.

For US citizens and green card holders, inheritance tax in France creates a second layer of obligations – including Form 3520 reporting, potential US estate tax exposure, and ongoing FBAR or FATCA filing requirements for inherited accounts.

This guide covers French succession rates and allowances, forced heirship rules, the US-France estate tax treaty, and every US reporting obligation triggered by a French inheritance.

It is written for the 2025 tax year, filed during the 2026 filing season. Forward-looking 2026 figures are noted where relevant.

US expats in France face income tax, social charges, and wealth tax obligations in addition to succession tax. Our taxes in France for US expats guide addresses these broader obligations.

US expats who own French real estate should also review property tax in France for non-residents.

How French succession tax works: The legal framework

France uses a civil-law forced heirship system governed by the Code Civil. The succession process is administered through a notaire – a state-appointed civil law notary – who prepares the legal documentation and files the declaration de succession with the French tax authority.

Unlike the US estate tax, which is levied on the estate before distribution, French succession tax is assessed on each heir individually after their share is determined.

Succession tax in France is not an estate tax in the American sense. The estate itself does not pay a lump sum before assets are distributed. Instead, each heir calculates their own tax based on their relationship to the deceased, the applicable allowance, and the progressive rate scale for that relationship category.

French succession follows the Code Civil's rules on who inherits and in what proportion, subject to forced heirship provisions that reserve a minimum share for children.

Brussels IV and the choice of law

The EU Succession Regulation – commonly called Brussels IV – allows EU-resident expats to elect the law of their nationality to govern succession.

A US citizen living in France can elect US law to govern the distribution of their estate. French tax rates still apply to French-situated assets regardless of which law governs the civil succession.

The 2021 claw-back mechanism

A 2021 amendment (Law No. 2021-1109 of August 24, 2021) added a third paragraph to Article 913 of the Code Civil.

It lets a child (or their heirs) claim compensation from French-situated assets if the deceased or at least one child is an EU national or habitually resides in an EU country, and the foreign law governing the succession provides no protective mechanism at all for children, not merely a smaller one than the French forced-heirship share.

US expats who rely on a Brussels IV election should confirm with both a notaire and a US estate attorney whether the 2021 claw-back mechanism would actually apply to their situation – recent interpretive guidance narrows its scope to cases where the applicable foreign law has no child-protection mechanism of any kind, not merely one less generous than French forced heirship.

For background on how the IRS defines residency for US tax purposes, see our guide to resident and non-resident citizens and non-citizens.

Who pays French inheritance tax: residents vs. non-residents

Three scenarios determine whether French inheritance tax applies and to which assets:

• Deceased was a French resident. France taxes the worldwide estate. Every asset the deceased owned – French and foreign – is included in the succession tax base, regardless of where the heirs live.
• Heir is a French resident who has been resident for at least 6 of the prior 10 years. Under Article 750 ter of the Code General des Impots, worldwide assets received by that heir are taxable in France – even if the deceased lived outside France and the assets are located abroad.
• Neither party is a French resident. Only French-situated assets are taxable. This includes French real estate, shares in French companies whose assets are primarily French real property, and French bank accounts.

 

A US citizen who has lived in Paris for seven years and inherits a US brokerage account from a US-resident parent may owe French succession tax on that account – not just on French-situated property.

US citizens and green card holders remain subject to US tax on worldwide income regardless of how many days they spend in France or the US. The closer connection exception, which lets certain nonresident aliens avoid US tax residency, does not apply to citizens or green card holders and has no bearing on the French six-of-ten-year rule

French inheritance tax rates and allowances by heir category

Spouses and PACS partners pay zero French succession tax regardless of estate size – one of the most significant planning advantages in French law.

The table below shows the allowance each heir category receives and the applicable rate range. Rates are progressive for direct-line heirs – only the portion of the taxable share within each bracket is taxed at that bracket's rate, not the entire amount at the top rate.

 

These allowances and rates have been stable under French law for several years. Two separate amendments during the 2025 budget process proposed raising the children's allowance to €120,000.

A separate amendment proposed raising the levy on assurance-vie payouts, aligning it more closely with the direct-line succession bands rather than changing the standard succession tax scale itself. Neither amendment passed into law.

French inheritance tax rates for children work on a progressive scale with 7 brackets.

Based on a common TFX client scenario: a US expat's child inherits €250,000 from one parent. After the €100,000 allowance, the taxable base is €150,000. The first €8,072 is taxed at 5%, the next band at 10%, the next at 15%, and the remainder at 20% – producing an effective rate well below the 20% bracket rate. The total tax on a €150,000 taxable base is approximately €28,194.

A disabled heir may claim an additional €159,325 allowance on top of the standard relationship-based allowance.

Forced heirship rules in France: What you cannot change

Under France's reserve hereditaire, children are legally entitled to a minimum share of a parent's estate. The remaining portion – the quotite disponible – can be freely disposed of by will. The reserved shares are set by Article 913 of the Code Civil:

1. One child – the reserved share is one-half of the estate. The other half is freely disposable.
2. Two children – two-thirds of the estate is reserved, split equally between them. One-third is freely disposable.
3. Three or more children – three-quarters of the estate is reserved, split equally. One-quarter is freely disposable.

Under the EU Succession Regulation, the law of the deceased's habitual residence generally governs the succession as a whole unless the deceased made a valid election for the law of their nationality. French forced-heirship rules therefore do not apply solely because an asset is located in France. Article 913 can still allow a compensatory claim against French-situated assets when its statutory conditions are met.

Inheritance law in France applies these reserved shares automatically. A US will that leaves everything to a surviving spouse does not override French law for French-situated property unless the deceased made a valid Brussels IV election choosing US law.

Even then, the 2021 claw-back mechanism under Article 913 may give a child the right to claim compensation from French assets if the deceased or at least one child is an EU national or EU resident and the foreign law provides no protection for children at all.

 

For how ownership structures interact with US tax rules, see our guide to property ownership structures and how they affect your US expat taxes.

Usufruct and bare ownership: a key French estate planning tool

French law allows splitting property into usufruit – the right to use the property and receive income from it – and nue-propriete, or bare ownership. This structure is commonly used in succession planning to reduce the taxable value transferred at death.

Transferring bare ownership of French property during your lifetime can significantly reduce the succession tax base because the value is discounted based on the usufructuary's age.

When a property owner dies, the surviving spouse can retain usufruct in France while the children receive bare ownership.

The taxable value of the bare ownership is discounted according to a scale set by Article 669 of the Code General des Impots. The younger the usufructuary, the larger the discount.

The surviving spouse's usufruct is not taxed at all because spouses are fully exempt from succession tax.

The discount scale should be confirmed with a notaire for the current values at the time of the transfer or death. This structure can also be created during the owner's lifetime as part of a broader gifting strateg

The SCI structure: Using a French property company to manage succession

A Societe Civile Immobiliere is a French civil real estate company that holds property and issues shares to its members.

Instead of transferring real estate directly – which triggers succession tax on the full property value – the owner can gradually gift SCI shares to heirs over time. The tax-free allowance refreshes every 15 years under French law.

An SCI can be a powerful succession planning vehicle, but US expats must verify its US tax classification before using it.

Key points for US expat SCI owners:

• SCI shares may be valued at a discount to the underlying property value, further reducing the taxable base for gift and succession purposes.
• The 15-year gift allowance cycle allows each parent to give each child up to €100,000 in SCI shares every 15 years without triggering French gift tax. For a couple with two children, that is €400,000 every 15 years.
• US persons holding SCI interests may have Form 8858 or Form 8865 reporting obligations depending on how the IRS classifies the entity. An SCI is typically treated as a foreign disregarded entity or foreign partnership for US tax purposes.
• An SCI does not eliminate US estate tax exposure. French property held through an SCI is still included in the worldwide estate of a US citizen or domiciliary for federal estate tax purposes.

French property creates overlapping US and French tax obligations that require coordinated planning.

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US estate tax on French property: The American side of the equation

US citizens and domiciliaries are subject to US federal estate tax on their worldwide assets at death, including French real estate. The federal estate tax exemption for tax year 2025 is $13,990,000 per individual.

For deaths occurring on or after January 1, 2026, the exemption increases to $15,000,000 per individual under the One Big Beautiful Bill Act, signed into law on July 4, 2025.

A US citizen who owns a Paris apartment worth EUR 2 million is potentially subject to both French succession tax paid by heirs and US estate tax on the same asset.

This kind of double exposure is why cross-border estate tax in France scenarios need to be modeled on both sides, not just one. The top US federal rate is 40% on the value exceeding the exemption, and for most US expats, the high exemption means no federal estate tax is owed.

But the asset must still be included in the gross estate calculation. Form 706 may need to be filed if the total worldwide estate approaches the threshold.

Treaty relief for double taxation

The US-France estate tax treaty, signed in 1978 and amended by protocol in 2004, provides relief from double taxation on the same assets. The treaty allocates taxing rights based on domicile and situs and allows credits for taxes paid to the other country.

The US-France estate tax treaty: Avoiding double taxation

The US-France estate tax treaty is one of only a handful of US estate tax treaties in force, making France a relatively favorable jurisdiction for cross-border estate planning. The treaty's key provisions:

• French succession tax paid by a US-citizen heir on French assets can be credited against US estate tax liability via the foreign estate tax credit.
• The treaty allocates taxing rights based on domicile and the location of assets. Real property is generally taxed where it sits – French real estate is taxable in France regardless of the deceased's domicile.
• Green card holders and long-term residents who are US persons under domestic law may nonetheless be treated as domiciled in France under the treaty's fiscal-domicile tie-breaker rules if they live there – which changes how the treaty's credits and taxing-rights allocation apply to them. Confirm treaty domicile status with a specialist before relying on treaty benefits.
• The treaty provides a pro rata unified credit for the estate of a French domiciliary, allowing a proportional share of the US estate tax exemption.

The US-France estate tax treaty is one of only a handful of US estate tax treaties in force, making France a relatively favorable jurisdiction for cross-border estate planning.

 

This is separate from the Form 1116 foreign tax credit used for income taxes.

Failure to file Form 3520 for a qualifying French inheritance can trigger a penalty of 5% per month, up to 25% of the amount received.

Form 3520 does not create a tax liability – it is an information return only. The inheritance itself is generally not taxable income for US federal purposes. But the reporting obligation is separate from whether tax is owed, and the penalties for non-compliance are significant.

Form 3520 penalties and how to seek abatement

The standard penalty for a late or unfiled Form 3520 related to a foreign bequest is 5% of the gross reportable amount for each month or part of a month the return is late, capped at 25%. The IRS has an abatement process for taxpayers who can demonstrate reasonable cause.

Many US expats who inherit French property are unaware of the Form 3520 requirement – penalty abatement is available but requires a well-documented reasonable cause statement.

A successful reasonable cause request typically includes a chronology of events showing when the taxpayer learned of the obligation, evidence of prompt steps to comply, and documentation of the underlying transaction.

The IRS explicitly rejects claims based on foreign secrecy laws or ignorance of the law alone.

The Streamlined Filing Compliance Procedures may address everything together if the missed Form 3520 is part of a broader compliance gap with other unfiled international forms.

This option is available to non-willful filers who can certify that the failures were not due to willful conduct.

Capital gains tax on inherited French property: the stepped-up basis question

For US tax purposes, inherited property generally receives a stepped-up basis to fair market value at the date of death under IRC Section 1014. This can eliminate US capital gains tax if the property is sold shortly after inheritance.

A US expat who inherits a French apartment and sells it immediately may owe little or no US capital gains tax due to the stepped-up basis, but could still owe French capital gains tax depending on the holding period.

French capital gains rules on inherited property

France applies its own capital gains rules – plus-value immobiliere – when French property is sold. French capital gains tax is 19% plus 17.2% social charges on the net gain.

Taper relief begins after 5 years of ownership, with full CGT exemption at year 22 and full social charges exemption at year 30.

The holding period for French purposes starts on the date of death, not on the date the deceased originally acquired the property. An heir who sells shortly after inheriting starts the taper-relief clock from the date of death, generally with little or no taper relief yet available.

US reporting for the sale

On the US return, the gain is reported on Form 8949 and Schedule D in US dollars, using the stepped-up basis at date-of-death fair market value. French CGT paid generally qualifies for the foreign tax credit on Form 1116.

 

For the full US treatment of inherited property gains, see our guide on how to avoid paying capital gains tax on inherited property.

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FBAR and FATCA: Reporting inherited French bank accounts and assets

When a US person inherits French bank accounts or financial assets, ongoing FBAR and FATCA reporting obligations are triggered if account balances exceed the applicable thresholds. Key points:

• FBAR threshold – $10,000 aggregate across all foreign accounts at any point during the year. If a US person inherits a French bank account and the combined value of all their foreign accounts exceeds $10,000 at any time, FinCEN Form 114 must be filed.
• Form 8938 thresholds vary by filing status and residency. For US expats living abroad and filing single, the threshold is $200,000 at year-end or $300,000 at any point. For married filing jointly, the thresholds are $400,000 and $600,000 respectively.
• Inherited accounts must be reported from the date the heir gains control or beneficial ownership. The reporting obligation begins when the heir has signature authority or a beneficial interest – not when the succession is formally completed.

Inheriting a French bank account worth EUR 15,000 immediately triggers FBAR reporting obligations for a US person, even if the account is later closed.

 

Form 8938 captures a broader asset base than FBAR – including interests in foreign entities, foreign insurance policies with cash value, and foreign pension accounts.

The thresholds and asset definitions differ between the two filings.

How to avoid or reduce French inheritance tax: Legal strategies

The following strategies can legally reduce the succession tax burden for US expats with French assets. Each must be evaluated independently for its US tax treatment:

1. Use the 15-year gift allowance cycle. Each parent can give each child up to €100,000 every 15 years without French gift tax. Over two cycles, a couple with two children can transfer up to €800,000 tax-free.
2. Structure ownership via usufruct and bare ownership split during the owner's lifetime. Transferring bare ownership while retaining usufruct reduces the taxable value of the transfer based on the owner's age at the time of the gift.
3. Hold French property through an SCI and gift shares gradually. SCI shares may qualify for a valuation discount compared to the underlying property value, and shares can be gifted using the 15-year cycle.
4. Ensure a surviving spouse or PACS partner is the primary beneficiary. Spousal transfers carry zero succession tax – no cap, no conditions.
5. Consider life insurance – assurance-vie. Under French law, assurance-vie proceeds are taxed outside the standard succession framework. For premiums paid before the policyholder turns 70, each beneficiary receives a €152,500 tax-free allowance. Above that, the rate is 20% up to €700,000 and 31.25% beyond – substantially lower than the standard succession rates for non-spousal heirs.

Assurance-vie policies are one of the most tax-efficient succession tools in France, with beneficiaries potentially receiving significant sums outside the standard succession tax framework.

US tax treatment of French planning strategies

US persons must evaluate the US tax treatment of each strategy independently. An assurance-vie, for example, may be classified as a passive foreign investment company for US tax purposes, creating separate reporting and tax obligations.

For the broader picture on foreign property tax for US expats, see our detailed guide.

French inheritance tax for non-residents: Special considerations

If the deceased was not French tax resident and the heir does not meet France's 6-of-10-year resident-heir rule, France generally taxes French-situated inherited assets. French domestic succession-tax allowances and reductions are calculated under the same rules that apply to residents, subject to any applicable treaty.

A US resident who inherits a French villa from a non-resident French parent owes French succession tax on the property value, and must also evaluate US estate tax and Form 3520 reporting obligations.

Inheritance tax in France for non-residents follows the same rate scale and allowance structure as for residents – the €100,000 child allowance, the spousal exemption, and the progressive 5% to 45% brackets all apply. T

The key difference is the tax base: only French-situated assets are included when neither the deceased nor the heir is a French resident.

France has bilateral tax treaties with many countries that may modify the standard rules. For American heirs, the US-France estate tax treaty is particularly relevant – it allocates taxing rights and provides the foreign tax credit mechanism to prevent double taxation.

Non-residents who sell inherited French property face both French plus-value immobiliere and US capital gains tax on foreign property.

The holding-period rules and credit mechanisms differ on each side.

The role of the notaire in French succession

In France, a notaire is legally required to handle the succession process when the estate includes real property.

The notaire prepares the acte de notoriete – the declaration of heirs – and files the declaration de succession with the Direction Generale des Finances Publiques within the applicable deadline.

Notaire fees in France are regulated by law and are calculated as a percentage of the estate value – they are separate from and in addition to succession tax.

Filing deadlines and penalties

The filing deadlines are strict: 6 months from the date of death for deaths occurring in France, and 12 months for deaths abroad. Late filing triggers interest charges starting at 0.20% per month, plus a 10% penalty surcharge if the delay exceeds 6 months beyond the original deadline.

Payment and timing

Death duties in France – the traditional term for droits de succession – are due at the time the declaration is filed. Payment can be arranged in installments over one year, or up to three years if illiquid assets such as real estate make up 50% or more of the estate.

 

French inheritance tax vs. US estate tax: Side-by-side comparison

Understanding both systems simultaneously is essential for any US person with French property – the two taxes are assessed at different levels and on different parties.

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Starting succession planning early – ideally at the time of purchasing French property – is far less costly than restructuring an estate after a death has occurred.

French will requirements

A written will used in a French succession does not always have to follow French formality rules. Under the EU Succession Regulation, a written disposition can be formally valid under several connecting laws, including the law of the place where it was made, the testator's nationality, domicile or habitual residence, and, for immovable property, the law where the property is located. A handwritten will – testament olographe – is valid under French law if it is entirely handwritten, dated, and signed by the testator.

Cross-border estates benefit from having the will prepared or reviewed by a notaire who can coordinate with the US attorney.

For related trust filing considerations, see our guide to relief from filing Forms 3520 and 3520-A for certain tax-favored foreign trusts.

Common mistakes US expats make with French inheritance tax

The following six errors come up consistently in our work with US clients who have French property or French inheritances:

• Assuming a US will is sufficient to govern French real estate. It is not. Assuming French real estate is automatically governed by French succession law. Under the EU Succession Regulation, the law of the deceased's habitual residence generally governs the succession as a whole unless a valid nationality-law election applies.
• Missing the Form 3520 filing deadline because the inheritance was not recognized as a "foreign bequest." A French estate administered by a notaire under French law is a foreign estate for US tax purposes. If the aggregate bequest exceeds $100,000, Form 3520 is required.
• Failing to report inherited French bank accounts on FBAR in the year of inheritance. The FBAR obligation begins when the heir gains control or beneficial ownership of the account – not when the succession is formally closed.
• Overlooking the 6-of-10-year heir residency rule. A long-term US expat in France who has been resident for at least 6 of the prior 10 years may owe French succession tax on worldwide assets received – including US-based inheritances.
• Not obtaining a date-of-death appraisal to establish stepped-up basis for US capital gains purposes. Without a contemporaneous valuation, the stepped-up basis under IRC Section 1014 is difficult to substantiate on a later sale.
• Assuming the US-France estate tax treaty eliminates all double taxation without modeling both tax systems. The treaty provides credit mechanisms, not blanket exemptions. Both French succession tax and US estate tax must be calculated independently, and the credit applied correctly.

The most expensive mistake is inaction – French succession deadlines are strict, and IRS penalties for missed Form 3520 filings are substantial.

For the FATCA side of reporting failures, see our guide to FATCA penalties for non-compliance.

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