- Individuals
- Form 1099G/1099INT
- Estates
- Probate
- Penalties and Interest
Except where noted, use Schedule CR to claim any of these credits and attach it, with required documentation, to your return.
This credit is available to individual and fiduciary taxpayers making a qualified investment in the form of "equity" or "subordinated debt" in a pre-qualified small business venture. Businesses must file Form QBA by December 31 of the year that they request qualification. The business must reapply each year to maintain qualification. Investors must file Form EDC by April 1 of the year following the investment to apply for their credit. Submitting a late application will disqualify you for the credit. All applications must be sent to the Virginia Department of Taxation, Tax Credit Unit, P. O. Box 715, Richmond, VA 23218 - 0715. The Department of Taxation will notify investors of the amount of their authorized credit by June 30th.
Equity is common or preferred stock of a corporation, regardless of class or series. This also includes interest in a limited partnership, or a membership in a limited liability company. No equity investment will qualify for this credit if it is required to be redeemed or subject to an option to be redeemed by the issuer within 5 years of the date of issuance. Effective January 1, 2005, the required holding period for equity investments is 3 years.
Subordinated debt is indebtedness of a corporation, general or limited partnership, or limited liability company that by its terms: 1. requires no repayment of principal for the first 3 years after issuance, 2. is not guaranteed by any other person or secured by any assets of the issuer or any other person and 3. is subordinated to all indebtedness and obligations owed by the issuer to nationally or state-chartered banking or savings and loan institutions.
Effective January 1, 2005 a qualified business is a corporation, general or limited partnership or limited liability company that: 1) has its principal office or facility operations in the Commonwealth; 2) engages in its business activities primarily within Virginia and; 3) has annual gross receipts of $3 million or less based on the most recently completed fiscal year; 4) has not obtained during its existence more than 3M in aggregate gross cash proceeds from the issuance of its equity or debt investments.
The credit is equal to 50% of the qualified business investments made during the taxable year. If total annual requests for the credit exceed $3 million, the Department of Taxation will prorate the credit for each taxpayer.
The credit a taxpayer may claim per taxable year may not exceed the credit authorized by the Department of Taxation, $50,000, or the income tax liability on that year's return, whichever is less. The credit is nonrefundable. Unused credits may be carried forward up to 15 years.
Complete Schedule CR, Part XV, to claim this credit. Please note: Since the Department of Taxation does not complete authorization of these credits until June 30 each year, it will be necessary for the taxpayers with a May 1 due date to either file for an extension, or file an amended return in order to claim this credit.
Reference: Virginia Code 58.1 - 339.4.
This credit has been extended until January 1, 2015.
A Virginia resident or manufacturing business entity may claim an income tax credit for purchases of equipment that can produce tangible personal property items from recyclable materials. The manufacturing facility must be located within Virginia, and must be engaged in the manufacture, production, processing or compounding of tangible personal property for sale. The recycling machinery or equipment must be used exclusively in or on the manufacturing premises.
The credit is 10% of the purchase price paid during the taxable year for the recycling equipment. The total allowable credit may not exceed 40% of the tax liability, computed prior to applying the credit. Unused credits may be carried forward for 10 years.
Effective January 1, 2008 the amount of the credit attributable to a partnership, electing small business corporation (S corporation), or limited liability company (LLC) must be allocated to the individual partners, shareholders, or members in proportion to their ownership or interest within the business entity using Form PTE.
For additional information on how to qualify for certification, contact the Department of Environmental Quality P.O. Box 10009, Richmond, VA 23240-0009 or call 804-698-4145.
Individual filers complete Schedule CR, Part IV, and corporate filers complete Form 500CR, Part VII, to claim the credit. Attach your approved Form 50-115, as well as purchase receipts and invoices.
Reference: Virginia Code 58.1-338 and 58.1-439.7
This credit expired on January 1, 2003.
Corporations investing at least $350 million within the Commonwealth before January 1, 2003, are eligible for a corporate income tax credit for the purchase of recycling processing equipment. The manufacturing facility must be located within Virginia, and must be engaged in the manufacture, production, processing or compounding of tangible personal property for sale. The recycling machinery and equipment must be used exclusively in or on the manufacturing premises.
The credit is ten percent (10%) of the purchase price paid during the taxable year for the recycling equipment. The total allowable credit in any one tax year may not exceed sixty percent (60%) of the corporation's Virginia income tax liability. Unused credits may be carried forward for twenty (20) years.
To qualify for the credit, the Department of Environmental Quality must certify that such machinery and equipment is integral to the recycling process. To obtain certification, contact the Department of Environmental Quality, Equipment Certification Officer. In addition, the Department of Business Assistance must certify that the corporation has made the required investment within the Commonwealth.
Individual filers complete Schedule CR, Part IV, and corporate filers complete Form 500CR, Part VII, to claim this credit. Attach the approved form 50-115 from the Department of Environmental Quality and the receipts and invoices for the purchase of the equipment.
Reference: Virginia Code 58.1-439.8
Owners of rental property who provide a rent reduction to low income tenants who: 1) are over age 62; 2) have a mental disability, or; 3) have been homeless (those in domestic violence and homeless shelters) at any time within the previous 12 months preceding the lease term are eligible to apply for a state income tax credit.
The reduced rent must be at least 15% below the market rate. After January 1, 2000, no credit may be claimed unless credit was validly claimed on the unit for all or part of the month of December 1999. The credit is equal to 50% of the total rent reductions given to eligible tenants during the taxable year. The total amount of credit a taxpayer may claim per taxable year may not exceed their tax liability. Unused credits may be carried forward for five years. Total credits approved in a fiscal year cannot exceed $50,000.
For more information and to apply for the credit, contact the Virginia Housing Development Authority.
Individual filers complete Schedule CR, Part VII, and corporate filers complete Form 500CR Part VIII to claim this credit.
Reference: Virginia Code 58.1 -339.9.
You may qualify to claim this credit if you own land abutting a waterway on which timber is harvested, and forbear harvesting timber on certain portions of the land near the waterway. The distance from the waterway to the most distant end of the riparian buffer must be at least 35 feet and no more than 300 feet. The buffer must remain in place for at least 15 years. The land that is the subject of the credit cannot be the subject of this credit again for 15 years after it was first taken
To qualify for this credit, the property owner must comply with an individualized Forest Stewardship Plan to be certified by the State Forester. The credit amount is subject to recapture if the Stewardship Plan is violated
The credit is 25% of the value of timber on the area designated as a forested buffer for a waterway, not to exceed $17,500 or the total amount of tax liability, whichever is less. Unused credits may be carried forward for five years.
For more information contact the Virginia Department of Forestry, Fontaine Research Park, 900 Natural Resources Dr. Suite 800, Charlottesville, VA 22903-0758, or call (804) 977-6555.
Individual filers complete Schedule CR, Part XXI, and corporate filers complete Form 500 CR, Part XXI, to claim this credit. Attach a completed copy of DOF Form 179 to your tax return.
Reference: Virginia Code 58.1 - 339.10.
You may qualify to claim this credit if you were the beneficiary of a trust whose Virginia taxable income includes all of part of an accumulation distribution by the trust.
For the years in which income was accumulated, the distributing trust would have reported the income on its own fiduciary return and paid taxes accordingly. To prevent double taxation of the distribution to the beneficiary, Virginia law allows the beneficiary to claim a credit for the income taxes paid by the trust. The credit is computed as follows:
A schedule showing the credit computation must be attached to your return.
Reference: Virginia Code 58.1-370.
This credit may be claimed for purchases of vehicle emissions testing equipment, clean fuel vehicles and certain refueling equipment.
The credit is equal to 20% of the purchase or lease price for equipment certified by the Department of Environmental Quality for vehicle emissions testing. The equipment must be located within, or adjacent to, any locality that requires an enhanced vehicle emissions inspection program.
Individual filers complete Schedule CR, Part VIII, and corporate filers complete Form 500CR, Part IX, to claim this credit. Attach a copy of the Department of Environmental Quality's letter to the equipment vendor certifying that the equipment configuration meets the regulations for use in the enhanced vehicle emissions inspection program. To obtain a copy of the letter, contact your equipment vendor or the DEQ Northern Virginia Regional Office in Woodbridge.
General instructions -- For taxable years beginning before January 1, 2006, a credit may be claimed for: 10% of the deduction allowed under IRC Section 179A for the purchase of clean fuel vehicles, including hybrid vehicles, principally garaged in Virginia, or for the purchase of refueling property placed in service in Virginia; or, for taxable years beginning before January 1, 2007, 10% of the total costs used to compute the credit for electric vehicles under IRC Section 30. Individual filers complete Schedule CR, Part VIII, and corporate filers complete Form 500CR, Part IX, to claim this credit. For clean fuel vehicles, provide a property description. For qualified electric vehicles for which a federal credit was claimed, federal Form 8834 must also be attached. For refueling property, attach a copy of federal Form 4562 or other form showing computation of the Federal Section 179A deduction. Unused credits may be carried forward for five years.
Reference: Virginia Code 58.1 - 438.1.
For tax years beginning on or after January 1, 1999, a business that operates a facility in Virginia that accepts waste motor oil from the public is allowed a tax credit equal to 50% of the purchase price paid for equipment used to exclusively burn waste motor oil.
The total amount of credit a taxpayer may claim per taxable year may not exceed $5,000. The taxpayer can only use the credit in the year the qualified equipment is purchased. Any unused portion of the credit may not be carried forward.
The Department of Environmental Quality must certify the equipment prior to claiming this credit. Apply for certification by filing Form DEQ 50-12 with the Department of Environmental Quality at 629 E. Main Street, 5th floor, Richmond, VA 23219. For additional information contact the Department of Environmental Quality at 804-698-4145.
Individual filers complete Schedule CR, Part XVII, and corporate filers complete Form 500CR, Part XVIII, to claim this credit. Attach the certificate from the Department of Environmental Quality, receipts, invoices or other documentation to confirm purchase price paid.
Reference: Virginia Code 58.1-439.10
This credit allows an employer to claim a tax credit for the training costs of providing eligible worker retraining to qualified employees for taxable years beginning on or after January 1, 1999.
The credit may be applied against individual income tax, estate and trust tax, corporate income tax, bank franchise tax, and taxes imposed on insurance companies and utility companies.
Eligible worker retraining includes approved non-credit courses provided by any of the Commonwealth's community colleges or a private school. It also includes credit or non-credit retraining courses undertaken through an apprenticeship agreement approved by the Virginia Apprenticeship Council.
Generally, the credit is 30% of all classroom training costs but is limited to up to $100 annual credit per student if the course work is incurred at a private school. The Department of Taxation is authorized to issue up to $2,500,000 of retraining credits annually. If total requested credits exceed this amount, the Department of Taxation will prorate the authorized credits.
Credits taken may not exceed your tax liability in any one taxable year. Unused credits may be carried forward for three years.
Employers must apply for certification of the amount of allowable credit using Form WRC. All WRC applications requiring course approval must be sent to the Virginia Department of Business Assistance, 707 East Main Street, Suite 300, Richmond, VA 23219 by April 1 following the year that the expenditures were paid or incurred. Applications requesting apprenticeship retraining credit must be sent to the Virginia Department of Taxation, Tax Credit Unit, P.O. Box 715, Richmond, VA 23218-0715 by the same April 1 deadline.
The Department of Taxation will notify WRC applicants of their allowable credit by June 30.
For information on pre-approved apprenticeship programs, contact your Virginia Department of Labor and Industry apprenticeship representative. For information on non-credit course approval, contact the Virginia Department of Business Assistance.
Individual filers complete Schedule CR, Part XVI, and corporate filers complete Form 500CR, Part XVII, to claim this credit.
Reference: Virginia Code 58.1 - 439.6.
Last Updated 12/5/2008 13:30
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