Tax Type
Corporation Income Tax
Description
Permission to file a separate return
Topic
Returns/Payments/Records
Date Issued
08-19-1987
August 19, 1987
Re: Va. Code §58.1-442: Permission to File a Separate Return
Dear**************
This will reply to your letter of May 27, 1987 requesting permission for Subsidiary 1 and Subsidiary 2 to file separate Virginia income tax returns for calendar year 1986.
You indicate that the Parent acquired a business in Virginia in December 1985 and became subject to Virginia income tax, and that the Parent and Subsidiary 1 filed a consolidated return for calendar year 1985. Subsidiary 1 had previously filed separate Virginia income tax returns. In January 1986 the Parent created Subsidiary 2 and contributed to it the assets and liabilities of the Parent's Virginia business. As a result, the Parent is no longer subject to Virginia income tax. You acknowledge that Subsidiary 2, as a newly-formed member of the affiliated group, is bound to join in the filing of the consolidated return. You assert, however, that filing separate returns for each subsidiary will more accurately report Virginia taxable income.
Once an election has been made to file consolidated returns, permission is generally not granted to change to separate or combined returns. Accordingly, permission to change to filing separate returns is denied.
Sincerely,
W. H. Forst
Tax Commissioner
Rulings of the Tax Commissioner