Home costs of the mother as extraordinary burden and survivor lump sum
September 17, 2011 | 35,00 EUR | answered by Oliver Burchardt
I have filed an objection regarding the income tax assessment of my husband and me because
a) the nursing home costs for my mother-in-law were not recognized as extraordinary expenses. My mother-in-law is in nursing care level two and is housed in a nursing home. Since her pension is far from sufficient, my husband, as the only financially capable son, has covered the difference (approximately €7000). To my knowledge, such expenses are deductible up to a certain limit for nursing care level two.
The tax office justifies the rejection by stating that my mother-in-law is not in need, even though my husband was financially responsible. The letter is attached as an annex.
b) The survivor lump sum of €370 was not recognized. Until our marriage in October/10, my husband was a widower and his daughter, who is a student, received orphan's pension from the German Pension Insurance. My husband was entitled to widower pension, but the pension was suspended due to high income.
My question now is: Is the tax office's argumentation correct - can the nursing home costs in particular really not be deducted?
(Attached as an annex is page 2 of the income tax assessment)
If the tax office is wrong, how can one argue (legal basis, court decisions)?
Dear inquirer,
Thank you for your inquiry, which I am happy to answer as part of an initial consultation.
The argumentation of the tax office is limited to the deductibility under § 33a EStG, as far as I can judge based on the documents provided, which seems to be correct. However, the case worker fails to recognize that the recognition of caregiving expenses for relatives should also be examined under § 33 EStG. There are no explanations on this matter in the letter, so you should not withdraw your objection in this regard.
Under § 33 EStG, all caregiving expenses should be recognized as extraordinary burdens that have not already been recognized under § 33a EStG and exceed the reasonable burden. The reasonable burden for you is €3,362, so that almost €3,700 should be deductible as an extraordinary burden.
The tax treatment of caregiving expenses is complex, but is relatively clearly explained in a letter from the Ministry of Finance. You can find this letter at the following link: http://treffer.nwb.de/completecontent/dms/content/000/087/Content/000087836.htm
Refer to this letter (BMF dated 2.12.2002, ref IV C 4 -S 2284 - 108/02) in your response to the tax office and request consideration of the remaining caregiving expenses under § 33 EStG.
Regarding the consideration of the surviving dependents lump sum, I cannot assess whether the rejection was unjustified without seeing the pension notification. The German Pension Insurance is only the bearer of the pension obligation. However, it is relevant for what legal reason the pension is paid. If one of the legal reasons mentioned in § 33b (4) EStG is applicable, the lump sum must also be granted.
I hope my explanations have been helpful to you.
Best regards,
Oliver Burchardt
Tax Advisor
