Loss deduction for income tax purposes.
July 25, 2011 | 75,00 EUR | answered by Dr. Yanqiong Bolik
In 2005, I subscribed to a ship participation and sold it at a loss through the time market in 2008. The tax office refuses to acknowledge the loss because there is no certificate from the ship company's branch office finance. I have filed an objection and now have to justify it.
Dear inquirer,
Thank you for your inquiry. Based on the information provided, I am happy to answer your question within the scope of an initial consultation, taking into account your input and the rules of this platform. The opinion is based on the facts presented. Missing or incorrect information about the actual circumstances can affect the legal outcome.
- With your participation in a shipping company (partnership), you were a co-entrepreneur as a partner between 2005 and 2008 according to §15 Abs. 1 No. 2 EStG and earned income from business operations. Profits/losses of the shipping company are distributed to shareholders and taken into account in their income tax assessment.
- The prerequisite for the recognition of commercial income (especially in the case of a loss assignment company) is proof of the intention to make a profit. If this is present, the assigned losses are generally recognized by the partners.
- Profit/loss allocation is carried out through a separate and uniform determination (§§ 179, 180 Abs. 1 No. 2 a AO). Such a determination decision is considered a basic decision for the income tax assessment.
- If there are no determination decisions in your records, I recommend contacting the management of the shipping company and asking for the missing determinations. Based on the information received from there, you can provide an explanation to the tax office as to why the certificates are not yet available and when you can submit them to the tax office.
I hope that I have provided you with an overview of the situation within this initial consultation and according to your input, and I am available for further questions in a personal conversation.
Best regards,
Dr. Yanqiong Bolik
Tax consultant
