Report every inheritance to the tax office.

A debate about inheritance tax has recently erupted. What many don't know: Even if you don't expect to pay any tax, you still have to report inheritances to the tax office.

The SPD's reform proposals have sparked a debate about the future of inheritance tax. The aim is to reduce the burden on small and medium-sized inheritances, for example, through a tax-free allowance of around one million euros per inheritance. Currently, spouses or registered civil partners can inherit up to 500.000 euros tax-free. Children can inherit 400.000 euros from each parent, and grandchildren 200.000 euros from their grandparents tax-free. Siblings, nieces, nephews, and life partners can expect a tax-free allowance of 20.000 euros.

But: Every inheritance must be reported to the tax office. Even if the inheritance is below the tax-free threshold. This is pointed out by the Wage tax assistance Bavaria (Lohi) "Since inheritances may be subject to tax, the tax office is interested in who has bequeathed what to whom. Anyone who fails to report this risks a fine or criminal proceedings for tax evasion," warns the wage tax assistance association.

"Many people are unaware that they are obligated to actively inform the tax office – even if they believe they don't have to pay any taxes," explains Tobias Gerauer, board member of Lohi. The tax offices, however, would common sense "Let it be done: "In exceptional cases, this can be waived if it is clearly established that there is no tax liability," said Gerauer.

However, neglecting the reporting obligation is not a good idea, as it could result in a tax liability. "Authorities such as the registry office, the probate court, and notaries inform the tax office about deaths and probate matters."

You must notify the tax office within three months. by itself Inform about the inheritance or legacy. For the notification of inheritance (§ 30 ErbStG), a simple but comprehensive letter is sufficient, according to tax experts. 

What does the tax office want to know?

• Name, address and occupation of the deceased
• Name, address and occupation of the acquirer
• Date and place of death 
• Type, extent and value of the assets
• The relationship between the deceased and the heir 

The inheritance notification can be submitted electronically as MAGPIE-Message or by post.

"The tax office responsible is the one at the deceased's place of residence; however, it is rare for a tax office to have an inheritance tax department on its premises. The competent tax office for the district of residence can be found in the directory on the website of the Federal Ministry of Finance," according to the wage tax assistance association.

After receiving the notification, the tax office will then check whether a Inheritance tax return This is required. It becomes mandatory when assets such as real estate, securities, bank balances or company shares are transferred.

Source: Lohi.de

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