During the 2018 Session, the Virginia General Assembly enacted House Bill 798 (2018 Acts of Assembly, Chapter 807), which requires multistate debt buyers to apportion their income to Virginia based upon a special method and based upon modified sourcing rules (“Debt Buyer Apportionment”). Under Debt Buyer Apportionment, debt buyers must use a single factor method of apportionment based on sales. Debt buyers must also use a market-based sourcing approach to source its sales that consist of money recovered on debt.
The legislation requires Virginia Tax to promulgate guidelines implementing Debt Buyer Apportionment. These guidelines will set forth methodology for sourcing sales that consist of money other than debt and provide general guidance regarding Debt Buyer Apportionment.