Tax Type
Individual Income Tax
Description
Mutual fund interest; Subtractions from Federal AGI
Topic
Collection of Tax
Subtractions and Exclusions
Date Issued
03-09-1989
March 9, 1989
Re: Virginia Code §58.1-1821 Application
Individual Income Tax
Dear********************
This is in response to your letters dated October 3, 1988 and February 14, 1989, in which you make application for correction of the individual income tax assessment issued to you and your wife for taxable year 1987.
FACTS
You timely filed your individual income tax return for taxable year 1987. On line 34 of the return, you claimed a subtraction from federal adjusted gross income for certain interest or dividend income on obligations of the United States exempt from state taxation. The amount that you claimed as a subtraction was income that you received from a regulated investment company ("mutual fund") which partially invested in obligations of the United States exempt from state taxation.
The department, in processing your return, disallowed this subtraction on the basis that you had not provided sufficient documentation regarding the exact amount of income attributable to interest or dividends from obligations of the United States.
You protest this action of the department and make application for correction of the resulting assessment.
DETERMINATION
The department recently issued a ruling regarding what documentation is sufficient to substantiate this particular subtraction (copy attached). Based upon this ruling and upon the fact that you have provided a copy of the quarterly breakdown provided to you by the mutual fund in which you have invested to substantiate your claimed subtraction, I find basis to abate the assessment.
If you have any further questions, please do not hesitate to contact the department.
Sincerely,
W. H. Forst
Tax Commissioner
Rulings of the Tax Commissioner