What's New For Tax Credits
In addition to the new credits, several changes to existing tax credits impact taxpayers filing their 2013 returns.
- Communities of Opportunity Tax Credit HB 2059 – Effective for fiscal year 2013 the cap is $250 thousand.
- Education Improvement Scholarships Tax Credit HB 321 & SB 131 – Effective for taxable years beginning on and after January 1, 2013, but before January 1, 2018. Allows taxpayers to claim a credit against the individual income tax, corporate income tax, bank franchise tax, insurance premiums license tax, or tax on public service corporations for contributions to approved scholarship foundations. Capped at $25 million per fiscal year. Unused tax credits can be carried over for five years. Approved scholarship foundations must disburse 90% of the value of donations (in the form of scholarships) it receives between July 1 and June 30, by the following June 30. Administered by the Department of Education.
- Land Preservation - CAP is $100 million for 2013 and each year thereafter. Affidavit Requirements
- Form LPC-2 ONLY – address changed to PO Box 26544 Richmond, VA 23261-6544
- Effective for 2014, the Tax Department is unable to guarantee that any LPC-1 application received/postmarked on or after the first business day in November will be processed in time to make a current year transfer. We will use our best efforts and resources available to process these applications by the end of the year.
- Long-Term Care Insurance Credit – Expired December 31,2013
- Major Business Facility Job Tax Credit – Use this Schedule A worksheet to calculate line 3B.
- Neighborhood Assistance Act (NAP) HB 321 & SB 131 – Expands the Neighborhood Assistance Act Tax Credit program by increasing the tax credit percentage from 40 percent to 65 percent of the value of donations. To qualify, individuals must donate at least $500. An individual may be eligible to receive a NAP tax credit for a donation value up to $125,000 per taxable year. Additionally, the cap for NAP has been increased from $11.9M to $15M. (The credit cap for education proposals has been increased from $4.9M to $8M and the credit cap for all other proposals remains at $7M.) HB 368 expands the professional services eligible for tax credits to include services provided by mediators certified by the Judicial Council of Virginia.
- Port Volume Increase Tax Credit - Allows an income tax credit to a qualifying taxpayer that is an agricultural entity, manufacturing-related entity (manufacturer or distributor of manufactured goods), or mineral and gas entity that uses port facilities in the Commonwealth and increases its port cargo volume by a minimum of 5% at these facilities for taxable year beginning January 1, 2011 but before January 1, 2017.
- Qualified Equity And Subordinated Debt Investments Credit – Effective January 1, 2013 the cap has increased to $4.5 million.
- Research & Development Tax Credit – Use this spreadsheet to compute the Virginia base amount for calendar and fiscal year filers.
- Telework Expenses Tax Credit – new email address email@example.com
- Worker Retraining Tax Credit HB 1923 – Increases the maximum credit amount per employee for courses taken at a private school to $200 (or $300 if the retraining is a STEM or STEAM discipline) and adds a sunset date to the tax credit (December 31, 2017).
(1) Section 58.1-512(D)(2) of the Land Conservation Incentives Act states: “Applications for otherwise qualified donations of a less-than-fee interest shall be accompanied by an affidavit describing how the donated interest in land meets the requirements of § 170(h) of the United States Internal Revenue Code of 1986, as amended, and the regulations adopted thereunder. The application with accompanying affidavit shall be submitted to the Department of Taxation, with a copy also provided to the Department of Conservation and Recreation.”
The requirements of this section can be met by completing Form LPC-1 Section VI- Less-Than-Fee-Donations. This section should be completed by the applicant describing how the donation meets the requirements of §170(h) of the United States Internal Revenue Code of 1986, as amended.
(2) Section 58.1-512.1(C) of the Land Conservation Incentives Act states: “Any appraisal submitted in support of an application for a credit under this article shall include an affidavit by the appraiser that to the best of his knowledge and belief the valuation complies with this section and shall set forth in the affidavit or refer to the specific portion of the appraisal setting forth the facts and basis for this knowledge and belief.”
The requirements of this section can be met with a notarized affidavit from the appraiser or a signed statement made under penalty of perjury that meets the requirements of § 8.01-4.3 of the Code of Virginia.
The statement should :
1. State to the best of the appraiser's knowledge and belief that the valuation made in the appraisal complies with § 58.1-512.1 of the Code of Virginia (1950), as amended.
2. Set forth specific facts and basis for this knowledge and belief (or refer to specific portions of the appraisal in which such facts are set out) and that such facts are true and correct to the best of the appraiser's knowledge and belief.
3. Include the declaration set out in § 8.01-4.3 such as: I declare under penalty of perjury that the forgoing is true and correct.
4. Include the date of the appraiser's signature.
The following would be an acceptable example:
I declare under penalty of perjury that to the best of my knowledge and belief (i) that the valuation made in the foregoing appraisal complies with § 58.1-512.1 of the Code of Virginia (1950), as amended, (ii) that all of the relevant facts and assumptions that form the basis for the valuation and compliance with § 58.1-512.1 are set forth in section(s) ___________ of this appraisal, and (iii) that such facts are true and correct to the best of my knowledge and belief except as qualified in the foregoing sections, and if qualified, that the stated reservations concerning the facts were taken into account in the valuation.
LPC-1 applications received on or after August 1, 2009 that do not have Section VI completed (if applicable), and a signed statement or a notarized affidavit from the appraiser, will be considered incomplete and cannot be processed until these requirements have been met.
Last Updated 1/8/2014 14:16