Tax Type
Individual Income Tax
Description
Nonresident individual; Computation of pilot's income
Topic
Taxpayers
Date Issued
06-18-1985
June 18, 1985
RE: Ruling Request/Individual Income Tax
Dear ****
This will reply to your letter of April 12, 1985, concerning the application of withholding and individual income taxes to your particular employment situation.
FACTS
You are a resident of Tennessee employed as a pilot by an employer located in Bristol, Virginia. The helicopter that you pilot for your employer is hungered in Tennessee. This helicopter is used by your employer to fly prospective customers, as well as, middle and upper level management employees to various manufacturing plants and coal mines located in Virginia and other Appalachian states.
You estimate that approximately seventy percent (70%) of your time is spent outside of Virginia flying for your employer. Since the majority of your income is earned performing services outside of Virginia, you request relief on a pro-rata basis from Virginia income tax.
DETERMINATION
A nonresident who has income from carrying on a business, trade, profession, or occupation within Virginia is required to file a Virginia return, unless the individual meets the "$3,000 filing exception" described in Virginia Code § 58.1-321. The Virginia taxable income of a nonresident is computed by multiplying his Virginia taxable income (computed as if he were a resident) by the ratio of his net income, gain, loss, and deductions from Virginia sources to his net income, gain, loss, and deduction from all sources.
Assuming that your only income from Virginia sources is your salary from your Virginia employer, your "net income, gain, loss, and deductions from Virginia sources" would be an amount equal to (1) your total annual salary from your employer, (2) multiplied by the number of days or portion thereof that you spend in Virginia performing your duties for your employer, and (3) divided by the number of days or portion thereof that you spend anywhere performing your duties for your employer.
Virginia Code §§ 58.1-461 and 58.1-460 require an employer to withhold taxes from the wages paid to an individual, whether a Virginia nonresident or resident, who performs or performed any service in Virginia for wages.
In order to compute the amount of withholding, your employer would be permitted to rely on information provided by you. You should file with your employer a pro forma return (nonresident income tax) based on income received during the most recent calendar year (1984). You should advise your employer when and if circumstances change. It will remain your responsibility to file and pay estimated Virginia tax if you are so liable, or to advise your employer to adjust the amount of withholding to avoid liability for payment of estimated tax.
Sincerely,
W. H. Forst
Tax Commissioner
RE: Ruling Request/Individual Income Tax
Dear ****
This will reply to your letter of April 12, 1985, concerning the application of withholding and individual income taxes to your particular employment situation.
FACTS
You are a resident of Tennessee employed as a pilot by an employer located in Bristol, Virginia. The helicopter that you pilot for your employer is hungered in Tennessee. This helicopter is used by your employer to fly prospective customers, as well as, middle and upper level management employees to various manufacturing plants and coal mines located in Virginia and other Appalachian states.
You estimate that approximately seventy percent (70%) of your time is spent outside of Virginia flying for your employer. Since the majority of your income is earned performing services outside of Virginia, you request relief on a pro-rata basis from Virginia income tax.
DETERMINATION
A nonresident who has income from carrying on a business, trade, profession, or occupation within Virginia is required to file a Virginia return, unless the individual meets the "$3,000 filing exception" described in Virginia Code § 58.1-321. The Virginia taxable income of a nonresident is computed by multiplying his Virginia taxable income (computed as if he were a resident) by the ratio of his net income, gain, loss, and deductions from Virginia sources to his net income, gain, loss, and deduction from all sources.
Assuming that your only income from Virginia sources is your salary from your Virginia employer, your "net income, gain, loss, and deductions from Virginia sources" would be an amount equal to (1) your total annual salary from your employer, (2) multiplied by the number of days or portion thereof that you spend in Virginia performing your duties for your employer, and (3) divided by the number of days or portion thereof that you spend anywhere performing your duties for your employer.
Virginia Code §§ 58.1-461 and 58.1-460 require an employer to withhold taxes from the wages paid to an individual, whether a Virginia nonresident or resident, who performs or performed any service in Virginia for wages.
In order to compute the amount of withholding, your employer would be permitted to rely on information provided by you. You should file with your employer a pro forma return (nonresident income tax) based on income received during the most recent calendar year (1984). You should advise your employer when and if circumstances change. It will remain your responsibility to file and pay estimated Virginia tax if you are so liable, or to advise your employer to adjust the amount of withholding to avoid liability for payment of estimated tax.
Sincerely,
W. H. Forst
Tax Commissioner
Rulings of the Tax Commissioner