Tax claim in a "six-figure amount": Inheritance can be so expensive

Created: 01/19/2022 11:53 am

By: Andreas Thieme

If you inherit a property, you also have to pay tax on this inheritance.

But with the high real estate prices, this is a financial challenge for many.

© Hans-Jürgen Wiedl/dpa-Zentralbild/dpa

Real estate prices are rising almost constantly - and with them the amount of inheritance tax in the event of the owner's death.

For many heirs, this becomes a financial disaster.

Munich – Your own death: who likes to deal with it?

However, settling one's estate is one of the most important tasks in life - otherwise there is a risk of chaos for the bereaved who are fighting over money or property.

Only one in five has made provisions.

And even if they do: Wills are often contested by relatives – and a dispute arises in court.

In other cases, the family agrees, but the tax office wants its share – in the form of inheritance tax.

In Munich, this often amounts to millions and poses ever greater problems to real estate owners.

Inheritance tax: exemptions have not changed for years

The problem: The allowances for inheritance and gift tax - for children around 400,000 euros - have remained unchanged for twelve years, "although the market values ​​of real estate in the greater Munich area have multiplied since then," says Rudolf Stürzer from the Haus owner initiative & Ground. "Even for a terraced house in Munich, inheritance tax can amount to six figures." For an apartment building, even millions...

The consequences: "Especially social landlords or their heirs cannot finance the inheritance tax with the low rents and are increasingly forced to sell* the apartment building that has been in the family for generations," says Stürzer.

This benefits commercial investors who buy real estate and are obliged to maximize their investors' profits.

They raise rents, socially disadvantaged or seniors are squeezed out.

Demand: Social landlords should be exempt from inheritance tax

Stürzer demands: "Social landlords can no longer be stupid!" The assessment basis for the inheritance tax must be the income in the amount of the rental income - "and not the market value, which is only on paper".

Heirs who undertake to keep rents low for a certain period of time could be "exempted from inheritance tax," says Stürzer.