(2023) Who can claim funeral expenses on their tax return?

Death certificate, funeral service, obituary and grave all incur costs. If the inheritance is less than the funeral expenses, the bereaved can deduct the costs from their taxes.

Funeral expenses for a close relative can under certain circumstances be claimed as extraordinary expenses for tax purposes.

You can only deduct funeral expenses as extraordinary expenses if you are legally obliged to cover the costs or have voluntarily paid for moral reasons and the estate is insufficient.

If the estate is greater than the funeral expenses, a deduction is not possible. A death benefit insurance payout also reduces the funeral costs.

If all this applies, the proven costs (i.e. submit invoices) can be claimed as extraordinary expenses. However, the reasonable personal burden is deducted.

Tip: The death benefit paid to the heir does not reduce the deductible extraordinary expenses if it is taxable. Otherwise, the bereaved would be disadvantaged twice for tax purposes - according to the Federal Fiscal Court's decision of 15.6.2023 (VI R 33/20).