Special expenses
January 14, 2011 | 50,00 EUR | answered by Oliver Burchardt
Special expenses?
Accommodation costs for my sister-in-law; my wife's sister.
She used to live in the Viersen district. Her daughter lives in Bielefeld. When it became necessary to place her mother in a nursing home, she was able to secure a care placement for her mother at the Bodelschwingh Institution BETHEL.
The nursing costs were initially covered with her own funds. Since these have been depleted, the costs are now covered by the social welfare office. Her own children are unable to contribute to the costs.
During the transitional period until the social welfare benefits were approved, nursing costs were incurred but there were no more funds available. These costs were billed to the daughter, who has a low income and could not pay the bill.
After consulting with the Bethel institution, we then paid this bill (in installments).
The tax office denies the deduction of the expenses, stating that the sister is not legally entitled to maintenance.
Is there a way to claim these expenses as a tax deduction in any form?
Or have we made a mistake (from a tax perspective)? Should we have made a donation with a specific purpose to the Bodelschwingh Institution instead?
Dear inquirer,
Thank you for your inquiry, which I am happy to answer as part of an initial consultation.
The tax assessment is based on the information provided in the case. Changing, adding, or omitting information can affect the tax assessment.
The explanation given to you by the tax office, that the deduction of the assumed nursing costs is not possible due to the lack of maintenance obligation, is not sustainable in this form.
Nursing expenses are deductible extraordinary burdens when you cannot avoid payment for legal, factual, or moral reasons. If there is a maintenance obligation, this criterion is met. However, it is incorrect to conclude that a deduction is only possible with an existing maintenance obligation.
Case law has developed the criterion that a deduction is possible when the taxpayer cannot avoid payment for moral reasons, as if there is a legal obligation. This always depends on the individual case. However, it is considered insufficient that there is a general obligation to support needy people. Even family ties as such are not sufficient to meet the requirement.
You must assess your individual case to determine whether you can demonstrate an obligation to have helped your sister-in-law or otherwise displayed behavior that is socially unacceptable. The Federal Fiscal Court (BFH) uses the somewhat old-fashioned term of violating the sense of decency of all reasonable and fair-minded people. However, I must point out that the hurdles for recognition as extraordinary burdens are very high. You will have to prepare yourself for the fact that even if you explain such an obligation to the tax office, you will likely have to appeal and most likely proceed with tax court proceedings. The chances of success are not high.
A donation with a specific purpose would not have brought you success either, as you received consideration from the Bodelschwinghschen Anstalt. In your case, the consideration would not have directly benefited you, but another person who would have been relieved of a payment obligation. However, this does not change the assessment.
I regret that I cannot provide you with a more favorable answer.
Sincerely,
Oliver Burchardt
Tax consultant
