January 25, 2022
Re: § 58.1-1821 Application: Corporate Income Tax
Dear *****:
This will reply to your letter submitted on behalf of your client, ***** (the “Taxpayer”), in which you appeal the denial of its application for the Research and Development Expenses Tax Credit (the “Credit”) for the 2020 taxable year.
FACTS
The Taxpayer’s preparer submitted Form RDC, Application for Research and Development Expenses Tax Credit, for the 2020 taxable year (the “Application”) on September 9, 2021. The Department denied the Application as it was filed after the September 1, 2021, deadline. The Taxpayer appeals, contending the Application should be treated as timely filed because it relied on its preparer to timely file the Application and missing the deadline was beyond its control.
DETERMINATION
Pursuant to Virginia Code § 58.1-439.12:08, an individual, corporation, or pass-through entity may apply for the Credit. Virginia Code § 58.1-439.12:08 E provides that applications for the Credit “must be received by the Department no later than September 1 of the calendar year following the close of the taxable year in which the expenses were paid or incurred.” [Emphasis added]
The Department has consistently ruled that reliance on a tax professional, while understandable, does not relieve a taxpayer of the responsibility for ensuring returns are timely filed. See, e.g., Public Document (P.D.) 11-82 (5/31/2011), P.D. 12-93 (6/8/2012), P.D. 16-169 (8/29/2016) and P.D. 19-69 (06/25/2019).
The provisions of Virginia Code § 58.1-439.12:08 E are clear and do not provide the Department with any discretion in enforcing the application due date. In this case, the Department received the Application on September 9, 2021, which was after the September 1, 2021, deadline. Accordingly, I find that the Application was properly denied.
The Code of Virginia sections and public documents cited are available on-line at www.tax.virginia.gov in the Laws, Rules & Decisions section of the Department’s web site. If you have any questions regarding this determination, you may contact ***** in the Office of Tax Policy, Appeals and Rulings, at *****.
Sincerely,
Craig M. Burns
Tax Commissioner
AR/3966.X