Tax Type
Corporation Income Tax
Description
Installment sale of business property; Capital gains and ordinary gains
Topic
Allocation and Apportionment
Date Issued
06-24-1985
June 24, 1985
Re: § 58.1-421 Request for Alternative Method of Allocation and Apportionment; Corporation Income Tax: FYE
Dear ****
This will respond to the undated and unsigned memorandum from Taxpayer received in *** 1985, requesting permission to use an alternative method of allocation and apportionment. By letter dated August 10, 1983 (a copy of which is enclosed), I denied Taxpayer permission to use an alternative method of allocation and apportionment for capital gains and ordinary gains resulting from an installment sale of business property located in *****. Taxpayer has presented no evidence or arguments different from those presented in 1983.
Although Corporation Income Tax Circular No. 1 has been replaced by Virginia Regulations 630-3-421 (copy enclosed), the policy applicable to requests for an alternative method of allocation and apportionment is unchanged. The General Assembly has provided a statutory method of allocation and apportionment that applies to all corporations; there is no election or discretion allowed to taxpayers or to the Department of Taxation. I construe Section 58.1-421 as authorizing me to allow use of an alternative method only in extraordinary circumstances where the need for relief has been demonstrated by clear and cogent evidence. I have reviewed all the evidence presented and find no such extraordinary circumstance. Accordingly, permission to use an alternative method of allocation and apportionment is denied.
Because the statutory method properly applies, there is no basis to process Taxpayer's claim for refund for fiscal years ended 1981 and 1982.
Sincerely,
W. H. Forst
Tax Commissioner
Re: § 58.1-421 Request for Alternative Method of Allocation and Apportionment; Corporation Income Tax: FYE
Dear ****
This will respond to the undated and unsigned memorandum from Taxpayer received in *** 1985, requesting permission to use an alternative method of allocation and apportionment. By letter dated August 10, 1983 (a copy of which is enclosed), I denied Taxpayer permission to use an alternative method of allocation and apportionment for capital gains and ordinary gains resulting from an installment sale of business property located in *****. Taxpayer has presented no evidence or arguments different from those presented in 1983.
Although Corporation Income Tax Circular No. 1 has been replaced by Virginia Regulations 630-3-421 (copy enclosed), the policy applicable to requests for an alternative method of allocation and apportionment is unchanged. The General Assembly has provided a statutory method of allocation and apportionment that applies to all corporations; there is no election or discretion allowed to taxpayers or to the Department of Taxation. I construe Section 58.1-421 as authorizing me to allow use of an alternative method only in extraordinary circumstances where the need for relief has been demonstrated by clear and cogent evidence. I have reviewed all the evidence presented and find no such extraordinary circumstance. Accordingly, permission to use an alternative method of allocation and apportionment is denied.
Because the statutory method properly applies, there is no basis to process Taxpayer's claim for refund for fiscal years ended 1981 and 1982.
Sincerely,
W. H. Forst
Tax Commissioner
Rulings of the Tax Commissioner