Offsetting tax losses from real estate properties
March 26, 2016 | 35,00 EUR | answered by StB Patrick Färber
I have 2 apartments that generate negative income. So far, they have reduced my taxable income. A few years ago, I emigrated. Since then, I have been filing my tax return in Germany as a limited tax resident. The tax office now sends me a notice every year about the loss carryforward. Currently, this amounts to around 20,000 EUR.
What happens if I return to Germany, become an unlimited tax resident again, and start earning income?
Can I offset this 20,000 against my taxable total income, meaning my taxable income is reduced by 20,000 EUR?
Dear inquirer,
Just to clarify: You are referring to negative income according to § 10d EStG, which has arisen through ongoing rental activities and is not subject to a provisional profit intention note.
If these have always been determined, then indeed they can be offset against other positive taxable income (excluding those from capital assets subject to final withholding tax) when later subject to unlimited tax liability.
The losses will then be subtracted from the "total amount of income" mathematically, before the section with deductible special expenses for both limited and unlimited purposes.
Best regards,
StB Färber
... Are you also interested in this question? 
