Real estate tax: If inheritance occurs while real estate is owned by a corporation

Owning real estate as a corporation is more advantageous when the real estate is of high value.
But what should you do if an inheritance suddenly occurs?
The real estate with the highest asset value among the inherited assets is owned by a corporation,
Even if you try to raise funds for inheritance tax by selling the real estate in question,
There is also a problem with the sale proceeds coming into the corporation.
It can be embarrassing if an inheritance suddenly occurs, but there are a few things you must check.

The size of the inherited property must be determined through the Ministry of Public Administration and Security's Safe Inheritance One-Stop Service (application for integrated processing of property inquiry, including for deceased persons). At this time, even debts in the name of the heir are confirmed, so if the debt is large, systems such as limited approval (debt repayment within the limit of inherited property) can be used.
If real estate and securities account for more than 1/2 of the inherited assets, it is possible to pay inheritance tax in kind. Considering that the inheritance tax payment deadline is 6 months, it may be necessary to consider paying stocks in kind if selling real estate is not easy. In addition, inheritance tax has an annual payment system, so it can be paid in installments over 10 years. However, tax payment collateral must be provided, and as interest rates have recently increased, the interest due on annual installments has increased to 2.9%. However, if it is difficult to sell within the reporting deadline, it is necessary to buy time through annual installment payments. If you sell the property at the right time, you can at least avoid real estate disposal losses due to a quick sale.

When an inheritance occurs, the remaining real estate is sold in a hurry due to the problem of reporting and paying inheritance tax within 6 months. So, if you want to sell it in a quick sale, you have to offer it at a lower price than the normal price. The problem starts from this point on. Due to the nature of real estate, it is difficult to determine the price at the time of inheritance, so it must be reported at the appraised value. However, if it is sold at a higher price than the appraised price even though it is a quick sale, the inherited property may be recalculated at the sale price. Of course, because the stock acquisition price increases due to inheritance, the transfer tax may be reduced when the inheritance is reduced, but the same is true because the inheritance tax increases.
If you own real estate as a corporation, you will receive stocks as inheritance, but if you have no other personal assets, you will have to sell the real estate and pay taxes. Even if real estate is sold at full price, tax issues arise when it is taken out because the sale funds go to the corporation. The method that can be used at this time is the so-called inheritance potato. From the child's perspective, the acquisition price is formed when the stock is inherited. Usually, the acquisition price is formed at the market price at the time of inheritance, unlike the face value per share at the time of establishment. If stocks acquired through inheritance are transferred to a corporation and then canceled, there is no stock transfer gain. After selling real estate owned by a corporation, you can take out the cash that came into the corporation and pay taxes, but you must pay corporate tax on the profit from the sale of real estate and check the corporate stock valuation due to inheritance. Since corporate taxes, etc. are also reflected in stock valuation, expert help is needed.

Star, a World Class Korea company, is a consulting brand that aims to provide diverse and convenient services to tax accountant customers by strengthening the service capabilities of tax accountants and connecting them with a network of experts in other fields so that tax accountants can become the center of consulting.

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