Inheritance and gifts of Mexican property: income tax

The federal exemptions

Article 93 lists income on which no income tax is paid:

• Fraction XXII: income “received by inheritance or legacy”.
• Fraction XXIII, gifts, in three cases:
  • a) Between spouses, or received by descendants from their ascendants in a straight line, “whatever the amount”.
  • b) Received by ascendants from their descendants in a straight line, provided the property received is not sold or given by the ascendant to another descendant in the straight line.
  • c) Other gifts, as long as the total received in a calendar year does not exceed three times the minimum wage raised to the year. Above that, tax is paid on the excess.

The Constitution’s transitional article on the minimum wage says that references to it as a unit of account in federal laws are read as the Unidad de Medida y Actualización (UMA). The annual UMA in force from 1 February 2026 is MX$42,794.64 (INEGI). As a calculation: 3 x MX$42,794.64 = MX$128,383.92. The law speaks of the minimum wage “of the taxpayer’s geographic area”; the UMA conversion is the Constitution’s rule, and the figure should be checked with the SAT.

Neither is a “sale” for the person who transfers

Article 119 says that transfers of property “by reason of death, gift or merger” are not treated as income from a sale. The person who passes the property on therefore does not report a gain.

What the heir or donee takes on: cost and date

Article 124 provides that for property acquired by inheritance, legacy or gift, the acquisition cost, for working out a later gain, is the cost paid by the deceased or the donor, and the acquisition date is theirs. If the donor had also received it free of charge, the rule goes back again. Where tax was paid on the gift, the appraisal value used for that tax becomes the cost, and the date of payment of that tax becomes the date.

Consequence, in formula form: later gain = sale price - updated (donor’s or deceased’s cost), with the years counted from the donor’s date. A long holding period may raise the updating and the number of years used to spread the gain (up to 20; see the capital gains guide). The 3% annual reduction of the building cost also runs from that original date.

The non-resident recipient: an open point

Article 160 (income of non-residents from real estate) contains the sentence: “In the case of acquisitions free of charge, the tax is determined by applying the 25% rate on the total value of the property’s appraisal, without any deduction; the appraisal must be made by a person authorised by the tax authorities. Gifts referred to in art. 93, fraction XXIII, paragraph a) are excepted.”

What the text does and does not say:

• It excepts spouses’ gifts and gifts from ascendants to descendants (paragraph a). It does not expressly except gifts under paragraphs b) and c).
• It does not say whether an inheritance received by a non-resident is an “acquisition free of charge” within this sentence. Article 93-XXII exempts inheritances, but art. 160 is written for non-residents. The question is unsettled in the texts read, and this guide does not assert an answer.
• Anyone in that position should ask a Mexican tax adviser, the notary handling the succession, or the SAT.

What the exemptions do not cover

• Local taxes and fees. Registering an inherited or gifted property, the notary’s work and any state or municipal transfer tax vary by state. The rules were not read for this guide.
• Succession procedure. How the estate is opened, with or without a will, is governed by each state’s civil code; see wills in Mexico and probate and succession.
• Foreign taxes. Inheritance or gift tax in the donor’s or heir’s home country is outside this guide.
• Property in a bank trust. The rights of a foreign beneficiary of a fideicomiso follow the trust deed; see bank trust explained.

Which professional to consult

• A notary (notario público), who prepares the deed of succession or gift and deals with the tax duties: notary page.
• A real estate lawyer, for succession law and cross-border questions: real estate lawyer page.
• A tax accountant, for the non-resident point and for keeping the donor’s cost records.