Ask a tax advisor on the topic of Tax return

Speculation tax on inheritance yes or no?

March 11, 2012 | 50,00 EUR | answered by Michael Herrmann

Hello, I am writing on behalf of the joint heirs (my 2 siblings and myself).

The situation:
Our father passed away in February 2010 and left us a semi-detached house with a plot of land in Strausberg. Since none of the three of us could have acquired and managed this alone, we decided to sell it. The purchase agreement is dated 28.9.2011, with a sale price of 120,000 euros for the land (1,529 sqm of agricultural land + 575 sqm of building and open space, with a right of way for the neighbor to the garage) and 80,000 euros for the house.
My parents took over the building with a purchase agreement dated 18.6.1990, and this property was registered in the building land register on 10.12.1990.
The right of use for the land was registered in the land register. My father renovated the building step by step and maintained and planted the land. With a purchase agreement dated 4.12.2007, the land finally passed into his possession for 73,570 euros. The land register entry was made on 3.12.2008.
Our question now is whether we have to declare this sale in our tax return. None of the three of us had registered a residence in this house.
This case I found with you seems relevant to me:
http://frag-einen.com/steuerberater/einkommensteuererklaerung/spekulationssteuer_bei_verkauf_von_geerrbter_immobilienverkauf-1412.html
Following sentence:
"In your case, it must first be assessed whether there is even a paid acquisition. You inherited the property. Therefore, there is no paid acquisition. Consequently, a private sales transaction, with regard to the property, is not possible."
Does this also apply in our case?
We would be very grateful for any advice on how to proceed in this matter. I am happy to attach any documents you may need.
Thank you in advance and best regards from Berlin.

Michael Herrmann

Dear inquirer,

First of all, thank you very much for your inquiry, which I would be happy to answer based on the information provided and in the context of your efforts within an initial consultation. The response is based on the description of the situation. Missing or incorrect information about the actual circumstances can affect the legal outcome.

The sale of the property is generally considered a private sale transaction if it occurs within 10 years of acquisition. If the conditions apply to the deceased, they also apply to the heir as a legal successor in case of gratuitous acquisition. The date of the purchase contract is crucial.

Regarding the sale of the building, the 10-year period has undoubtedly elapsed. The situation is different for the land. It was acquired on 04/12/2007.
However, another exemption provision is relevant for this assessment. Section 23 (1) No. 1 sentence 3 specifies: "Excluded are assets that have been used exclusively for personal residential purposes between acquisition or completion and sale, or in the year of sale and the two preceding years."

This requirement is met, as the deceased used the property himself within the specified period. The personal use of the deceased as the predecessor in title is also credited to the heir community.

There is no taxable private sale transaction with regard to the sale of the property according to § 23 EStG.

I hope that with this information provided within the scope of your efforts and this initial consultation, I have given you a sufficient overview of the situation and remain

Yours sincerely,

Michael Herrmann
Tax consultant
Diploma in Financial Management