What does loss offsetting across spouses mean?
If spouses issue a joint exemption order, this leads to an offsetting of the losses of one spouse against the profits and income of the other spouse at the end of the year. This offsetting of losses between spouses is carried out between all accounts and securities accounts (individual and joint accounts) held for the spouses at one bank. If you have already exhausted your exemption order at one bank and now wish to have losses offset across spouses at another bank, then issue a joint exemption order for EUR 0 there.
When is it possible to cancel an exemption order?
Cancellation is only possible at the end of the calendar year.
What does the tax identification number contain?
Due to a change in the law, as of 01.01.2011 you may only issue or change exemption orders if you state your tax identification number. Otherwise, the exemption order is invalid. The tax identification number is a nationwide and permanent identification number of citizens registered in Germany for tax purposes. It is valid for life and consists of a total of eleven digits. All personal data is stored for the identification number. In 2008, the tax ID was communicated to taxpayers in a cover letter from the Federal Central Tax Office (BZSt). For the time being, existing exemption orders will continue to be valid without the tax identification number.
What needs to be considered in the case of a joint account?
Spouses who maintain a joint account and who meet the requirements for joint assessment under the German Income Tax Act (Einkommensteuergesetz) issue a joint exemption order. At the end of the year, this leads to the losses of one spouse being offset against the profits and income of the other spouse.