Tax Type
General Provisions
Description
1991 LEGISLATIVE SUMMARY
Topic
Reports
Date Issued
06-01-1991
1991
LEGISLATIVE
SUMMARY
Virginia
Department of Taxation
LEGISLATIVE
SUMMARY
Virginia
Department of Taxation
W. H. Forst
Tax Commissioner
INTRODUCTION
The Legislative Summary is published by the Department of Taxation (TAX) as a convenient reference guide to state and local tax legislation enacted by the 1991 Session, of the General Assembly. It includes a general description of enacted legislation affecting:
- State taxes administered by TAX, and
- Local taxes which TAX administers or on which TAX renders advisory assistance.
Legislation granting property tax exemptions, granting taxing authority through local charters, creating special taxing districts, or affecting taxes administered by other state agencies is not included in the Summary.
The Summary is merely intended to provide an overview of enacted legislation and is for information purposes only. The Summary is not a substitute for the actual state law, local ordinances, and TAX regulations. Additional information on new legislation affecting state taxes may be obtained from TAX at the following telephone numbers:
Individual Income Tax (804) 367-8031
Corporation Income Tax (804) 367-8036
Sales and Use Tax (804) 367-8037
Additional information on new local tax legislation should be obtained from your local Commissioner of Revenue or Treasurer.
Virginia Department of Taxation
June 1991
June 1991
TABLE OF CONTENTS
SUBJECT PAGE
STATE TAX LEGISLATION
General Provisions
Penalties and Interest
Extensions
Period of Limitations
Tax Litigation
Provisions Affecting Individuals
Credit for Income Tax Paid to Another State
Operation Desert Storm
Estimated Tax Underpayment Penalty
Refund Check-Offs
Provisions Affecting Business Organizations
Corporation Income Tax: ACRS Subtractions
Sales and Use Tax: Out-of-State Dealers
Income Tax Withholding. Definition of Wages
Income Tax Withholding: 8th Monthly Filers
Income Tax: Credit for Substance Abuse Advertising
Sales and Use Tax Exemptions
Exemptions Extended Through June 30, 1996
Certain Day Care Centers
Public Library/Recreation Center
Public Libraries
Arts Centers
Free Enterprise Education Organizations
Amendments to Existing Exemptions Effective July 1, 1991
Farmers
Volunteer Fire Department/Rescue Squads
Meals on Wheels Programs
Science-Technology Museums
New Exemptions Retroactive to January I, 1984 through June 30, 1993
Heart Associations
Lung Associations
Diabetes Associations
Cancer Associations
New Exemptions Effective July 1, 1991 through June 30, 1993
Conservation Organizations
Women's Centers
Sporting Associations
Lions Clubs
REACT Teams
New Exemptions Effective July I, 1991 through June 30, 1996
Friends of the Public Library Organizations
Illiteracy Programs
LOCAL TAX LEGISLATION
Provisions Specifically Affecting Local Tax Officials
Individual Income Tax Payments
Disclosure of Information to Town Treasurers
General Local Tax Provisions
Periods of Limitation
Corporate Officer Liability
Collection of Tax from Third Parties
Collection Fees
Penalties and Interest Lack of Fault
Joint Tax Bills
Payment Dates
Payment Dates: Chesapeake
Tax Sale Proceedings
Provisions Affecting Local Real Estate Taxes
Tax Relief for the Handicapped: Certification of Disability
Tax Relief for the Elderly and Handicapped:
Income and Net Worth Limits
Use Value
Boards of Equalization
Provisions Affecting Local Tangible Personal Property Taxes
Tax Relief for the Elderly and Handicapped
Classifications: Disabled Veterans
Classifications: Auxiliary Police Officers
Classifications: Commercial Airlines
Authority to Prorate Tax
Proration: Replacement Vehicles
Proration: Credit Upon
Valuation of Automobiles: Pricing Guides
Valuation of Automobiles: Original Price
Provisions Affecting Local Business License Taxes
Nonprofit Hospitals and Institutions of Learning
Denial of License
State-Chartered Credit Unions
Coal and Gas Road Improvement Tax
STATE TAX LEGISLATION
GENERAL PROVISIONS
Key Points to Remember:
- Late filing/payment penalties for major taxes to
- Interest rates on underpayments of all taxes also o increase July 1, 1991
PENALTIES AND INTEREST
Effective July 1, 1991, House Bill 1830 (Chapter 331) and Senate Bill 739 (Chapter 316) will:
- increase monthly late filing and late payment penalties from 5% to 6% per month (and increase the maximum penalty from 25% to 30%) for the individual and corporation income taxes, income tax withholding, sales and use taxes (including the aircraft, watercraft, Northern Virginia motor vehicle fuel, and tire taxes), and the soft drink excise tax, and
- increase the interest rate charged on delinquent taxes administered by TAX-the Virginia underpayment rate will be the federal underpayment rate prescribed in Internal Revenue Code § 6621, plus an additional 2%.
The interest rate payable on tax overpayments (refunds) is not affected. Interest rates on underpayments of local taxes are also not affected.
NOTE: Based upon the quarterly federal interest rates that will take effect on
July 1, 1991, the corresponding Virginia rates for state taxes for the same period will be:
- Overpayments 9%
- Underpayments 12%
- Large ($ 100,000 +) corporation underpayments 14%
CODE SECTIONS AMENDED: §§ 58.1-15, 58.1-347, 58.1-351, 58.1-450, 58.1-455, 58.1-475, 58. I -635, 58.1-15 10, and 58.1-3219.1
EXTENSIONS
House Bill 1734 (Chapter 362) and Senate Bill 765 (Chapter 456) grant TAX the authority to eliminate individual and corporation income tax filing extension applications. If implemented, this would not eliminate the requirement that all taxes be paid by the due date.
TAX is currently studying the feasibility of eliminating the extension form. The earliest that TAX could eliminate the extension form is for taxable year 1992 returns filed in calendar year 1993.
CODE SECTIONS AMENDED: §§ 58.1-344 and 58.1-453
PERIOD OF LIMITATIONS
Effective July 1, 1991, House Bill 1734 (Chapter 362) and Senate Bill 765 (Chapter 456) conform the periods of limitations for the assessment and refund of taxes. As a result of the law change, assessments must be issued and refunds must be requested within 3 years from the last date for the timely filing of the return, including filing extensions.
Under current law, tax assessments must be issued within 3 years of the original due date of the return, while refunds may be issued if requested within 3 years of the extended filing date.
CODE SECTION AMENDED: § 58.1-104
TAX LITIGATION
Effective July 1, 1992, House Bill 1948 (Chapter 714) will permit taxpayers to post bond, with corporate surety licensed to do business in Virginia, when applying to a circuit court for correction of an erroneous assessment. The bond must be posted within 90 days of the date of assessment. Currently, taxpayers must pay an assessment in full before applying to the court.
CODE SECTION AMENDED: § 58.1-1825
PROVISIONS AFFECTING INDIVIDUALS
Key Points to Remember:
- Refunds relating to King v. Forst (credit for income taxes paid to an-other state) litigation will be limited
- Filing/payment extensions to be provided to Operation Desert Storm personnel
CREDIT FOR INCOME TAX PAID TO ANOTHER STATE
Effective retroactive to taxable year 1987, House Bill 1734 (Chapter 362) and Senate Bill 765 (Chapter 456) preclude individuals from claiming the tax credit for income taxes paid to another state with respect to franchise, license, excise, unincorporated business, and occupation taxes, or any other tax characterized as such by another state even though applied to earned or business income.
This change will preclude taxpayers from seeking refunds as the result of the Virginia Supreme Court's 1990 decision in King v. Forst involving payments of the District of Columbia unincorporated business franchise tax, unless the taxpayer filed a protective claim for refund prior to the bill's introduction January 22, 1991).
CODE SECTION AMENDED: § 58.1-332
OPERATION DESERT STORM
Effective March 20, 1991, House Bill 1698 (Chapter 361) and Senate Bill 791 (Chapter 346) will:
- exclude combat pay from the income tax to the same extent excluded for federal tax purposes;
- provide military and civilian support personnel in the Middle East combat zone (as designated by the President) or who were in "Desert Shield service" prior to the combat zone designation with the same individual income tax filing and payment extension as they receive for federal income tax purposes OR a 1-year extension, whichever is greater,
- provide military reservists and members of the National Guard who were called to active federal service a 1-year filing and payment extension;
- waive estimated tax filing and payment requirements for individuals and fiduciaries during the above extension periods;
- suspend the accrual of penalty and interest, suspend collection action on outstanding assessments, and suspend the period of limitations for all combat zone and Desert Shield personnel for the period that they enjoy a filing extension; and
- conform to provisions of federal law granting waiver of the current year's tax and any prior assessments for any member of the armed forces who dies in a combat zone or as the result of an injury suffered in a combat zone. The bills will also provide similar relief, consistent with federal law, for civilian and military employees of the United States who die in terroristic or military actions.
TAX is in the process of developing Guidelines to assist taxpayers affected by these bills. Virginia Tax Bulletin 91-3 provides additional information on these bills.
CODE SECTIONS AMENDED OR ADDED: §§ 58.1-322, 58.1-344, 58.1-344.1, 58.1-355, 58.1-49 1. 1, and 58.1-905
ESTIMATED TAX UNDERPAYMENT PENALTY
Effective for taxable year 1991, House Bill 1734 (Chapter 362) and Senate Bill 765 (Chapter 456) provide an alternative computation for the current estimated tax underpayment penalty based on the previous year's tax liability.
Under current law, the penalty is computed based on the difference between 90% of the current year liability and the taxpayer's timely estimated tax payments made during the year.
Like current federal law, this bill will allow taxpayers the alternative of computing the penalty based on the difference between 100% of their prior year's tax and the taxpayer's timely estimated tax payments made during the year.
CODE SECTION AMENDED: § 58.1-492
REFUND CHECK-OFFS
Effective for taxable year 1992, voluntary individual income tax refund check-offs will be added for the Family and Children's Trust Fund of Virginia (Senate Bill 584 - Chapter 173) and the Department for the Aging (Senate Bill 700 - Chapter 179).
CODE SECTIONS ADDED: §§ 58.1-346.3 and 58.1-346.4
PROVISIONS AFFECTING
BUSINESSES AND ORGANIZATIONS
BUSINESSES AND ORGANIZATIONS
Key Points to Remember:
- ACRS subtractions for corporations will not be available in taxable year 1991
- Effective July 1, 1991, out-of-state dealers selling goods to, Virginia residents may be required to collect the Virginia sales and use tax
- All wages subject to federal income tax withholding will also be subject to Virginia withholding
- Effective July 1, 1991; employers subject to 8th monthly withholding pay menu will switch to a quarterly reconciliation return in lieu of the current monthly reconciliation
CORPORATION INCOME TAX: ACRS SUBTRACTIONS
Senate Bill 770 (Chapter 210) delays the taxable year 1991 10% excess cost recovery (ACRS) subtraction until taxable year 1992. This will also delay the complete recovery of previous ACRS additions by corporations one additional taxable year from 1994 to 1995.
CODE SECTION AMENDED: § 58.1-323.1
SALES AND USE TAX: OUT-OF-STATE DEALERS
Effective July 1, 1991, House Bill 1366 (Chapter 565) and Senate Bill 782 (Chapter 544) expand the sales and use tax definition of "dealer" to include out-of-state businesses that solicit business on a continuous, regular, seasonal or systematic basis in Virginia by means of:
- advertising broadcast or relayed from a Virginia transmitter or distributed from a location within Virginia; or
- mailings into Virginia if the dealer benefits from any banking, financing, debt collection, or marketing activities occurring in Virginia or the location of authorized installation, service, or repair facilities in Virginia.
An out-of-state dealer is also required to collect the Virginia tax if it:
- is owned or controlled by the same interests which own or control a business currently located in Virginia;
- has a franchisee or licensee operating under the same trade name in Virginia and the franchisee or licensee is required to collect the Virginia tax; or
- owns tangible personal property that is rented or leased to a consumer in Virginia, or offers tangible personal property on approval to consumers in Virginia.
INCOME TAX WITHHOLDING: DEFINITION OF WAGES
Effective July 1, 1991, House Bill 1734 (Chapter 362) and Senate Bill 765 (Chapter 456) conforms Virginia to the federal definition of "wages" subject to withholding.
The effect of this change is to require employers to withhold Virginia tax for any employee for whom federal withholding is required. The two groups of employers primarily affected by this change are agricultural employers (who were previously exempt from Virginia withholding) and employers withholding from retired employees (Virginia withholding was previously optional for employers and retirees). To allow employers time to adjust, TAX will implement this provision effective January 1, 1992.
CODE SECTION AMENDED: § 58.1-460
INCOME TAX WITHHOLDING: 8th MONTHLY FILERS
Effective July 1, 1991, House Bill 1734 (Chapter 362) and Senate Bill 765 (Chapter 456) eliminate the requirement that 8th monthly withholding filers file a monthly reconciliation return. The current payment schedule will be retained; however, reconciliation returns will only be required on a quarterly basis.
CODE SECTION AMENDED: § 58.1-472
INCOME TAX: CREDIT FOR SUBSTANCE ABUSE ADVERTISING
Effective for taxable year 1992, House Bill 1521 (Chapter 287) creates an individual and corporation income tax credit for radio and television broadcasters who air public service messages concerning substance abuse. The credit will be equal to 20% of foregone revenues.
All advertisements must be preapproved by the Governor's Council on Alcohol and Drug Abuse Problems.
The bill will not be effective after taxable year 1993 unless reenacted by the General Assembly.
CODE SECTIONS ADDED: §§ 58.1-339.1 and 58.1-437
SALES AND USE TAX: EXEMPTIONS
Senate Bill 524 (Chapter 647) and Senate Bill 1504 (Chapter 1, Special Session No. 1) extended 5 existing sales and use tax exemptions that had been scheduled to expire on June 30, 1991, amended 4 other existing exemptions, and added II new exemptions.
As used in describing the sales and use tax exemptions listed below, the term "nonprofit organization" or "nonprofit corporation" is synonymous with an organization that enjoys an exemption from federal income taxes under Internal Revenue Code Sec. 501(c)(3).
Where appropriate, the organization(s) qualifying for these exemptions are identified. Other organizations may also qualify; however, they should request a ruling from TAX before making exempt purchases.
Exemptions extended through June 30, 1996:
- CERTAIN DAY CARE CENTERS: Tangible personal property used or consumed by a nonprofit organization organized primarily for the purpose of operating a state-licensed day-care center or preschool that hires only certified public school teachers or teachers who are college graduates holding a degree from an accredited 4-year institution of higher education and certified by an organization recognized by the U. S. Department of Education or by some other nationally recognized organization, and which has a regularly prescribed curriculum.
- PUBLIC LIBRARY/RECREATION CENTER: Tangible personal property used or consumed by a private, nonprofit corporation which operates a county public library which is also used as a recreational center for county residents: The Heritage Foundation Library is the only organization known at this time to qualify for the exemption.
- PUBLIC LIBRARIES: Tangible personal property used or consumed by a nonprofit organization organized primarily for the operation of a public library.
- ARTS CENTERS: Tangible personal property used or consumed by a nonprofit organization organized primarily for the purpose of operating an arts center offering a year-round schedule of art education classes for adults and children, a continuous series of exhibits focusing on 20th Century art, and sponsoring a wide range of seminars for the public at no or nominal charge. The Virginia Beach Center for the Arts is the only organization known at this time to qualify for the exemption.
- FREE ENTERPRISE EDUCATION ORGANIZATIONS: Tangible personal property used or consumed by a nonprofit organization organized primarily for the purpose of encouraging participation in the free enterprise system through information programs directed to secondary schools and college students, college scholarship programs, and recognition of achievement in the American free enterprise system. The Horatio Alger Association of Distinguished Americans is the only organization known at this time to qualify for the exemption.
Amendments to existing exemptions effective July 1, 1991:
- FARMERS: The existing exemption for agricultural activities is extended to (lama farmers. The exemption applies to all tangible personal property, other than structural construction materials, used in agricultural production for market
- VOLUNTEER FIRE DEPARTMENTS/RESCUE SQUADS: The existing exemption for tangible personal property used or consumed by volunteer fire departments and rescue squads is amended to exempt sales by such organizations and purchases and sales by their auxiliary organizations.
- MEALS ON WHEELS PROGRAMS: The existing exemption for food and food products sold to elderly persons by nutrition programs conducted under 42 U.S. Code Sec. 3030(e-g) is amended to exempt the sale of food and food products to disabled or handicapped persons under age 60.
- SCIENCE-TECHNOLOGY MUSEUMS: The existing exemption for nonprofit regional science-technology museums is amended to eliminate the requirement that at least 10% of the museum's budget be from the Commonwealth. The Virginia Living Museum and the Science Museum of Western Virginia are the only two organizations known at this time to qualify for the exemption.
New exemptions effective retroactive to January 1, 1984 through June 30, 1993:
- HEART ASSOCIATIONS: Tangible personal property used or consumed by a nonprofit organization organized exclusively and operated exclusively to provide education, training, certification in emergency cardiac care, research, and other related services to reduce disability and death from cardiovascular diseases and stroke. The American Heart Association is the only organization known at this time to qualify for the exemption.
- LUNG ASSOCIATIONS: Tangible personal property used or consumed by a nonprofit organization organized and operated exclusively to eliminate all lung disease (including asthma, emphysema, lung cancer and pneumonia) through medical research, public education focusing on disease prevention, patient education including information on coping with lung disease, smoking and air pollution prevention, and professional education and training. The American Lung Association and its affiliates are the only organizations known at this time to qualify for the exemption.
- DIABETES ASSOCIATIONS: Tangible personal property used or consumed by a nonprofit organization organized and operated exclusively for eliminating diabetes through medical research, public education focusing on disease prevention, patient education including information on coping with diabetes, and professional education and training. The American Diabetes Association is the only organization known at this time to qualify for the exemption.
- CANCER ASSOCIATIONS: Tangible personal property used or consumed by a nonprofit organization organized and operated exclusively to eliminate cancer as a major health problem by preventing cancer, saving lives from cancer, and diminishing suffering from cancer through research, education, and service. The American Cancer Society Virginia Division is the only organization known at this time to qualify for the exemption.
New exemptions effective July 1, 1991 through June 30, 1993:
- CONSERVATION ORGANIZATIONS: Tangible personal property used or consumed by a nonprofit organization organized exclusively to promote and support conservation and environmental issues throughout Virginia by encouraging the protection and restoration of waters, wildlife, and land; safeguarding the public health by eliminating pollution; nurturing and improving wildlife stocks; promoting the highest standards of sportsmanship and strengthening farmer sportsmen understanding; and performing other environmental services. The Virginia Wildlife Federation is the only organization known at this time to qualify for the exemption.
- WOMEN'S CENTERS: Tangible personal property used or consumed by a nonprofit organization organized exclusively to provide immediate and affordable counseling, and regularly scheduled workshops to address the psychological, educational, and p]rofessional concerns of women and their families. The Women's Center is the only organization known at this time to qualify for the exemption.
- SPORTING ASSOCIATIONS: Tangible personal property used or consumed by a nonprofit organization organized exclusively to advance the moral character and to promote sportsmanship, team spirit, fair play, honesty, and patriotism among youth by providing and supervising clean and wholesome activities for the youth in Appomattox County who participate in its programs. The Appomattox County Youth Association is the only organization known at this time to qualify for the exemption.
- LIONS CLUBS: Tangible personal property used or consumed by a nonprofit organization organized exclusively to provide aid and assistance to the blind or visually impaired or programs devoted to the prevention of eyesight loss; the deaf or hearing impaired; drug abuse and drug awareness programs; diabetes and diabetes detection programs; and assist and promote the cultural and educational opportunities of the musically talented boys and girls in Virginia. The exemption also applies to property purchased for use in fund-raising activities, the net proceeds of which are contributed directly to or used to fund the charitable purposes of the organization. Lions Clubs are the only organizations known at this time to qualify for the exemption.
- REACT TEAMS: Tangible personal property used or consumed in the performance of emergency services by Radio Emergency Associated Communications Teams, which are nonprofit organizations that operate and maintain public service communications and provide emergency services to motorists and their local communities.
New exemptions effective July 1, 1991 through June 30, 1996:
- FRIENDS OF THE PUBLIC LIBRARY ORGANIZATIONS: Tangible personal property used or consumed by a nonprofit organization exempt under IRC Sec. 501(c)(3) and organized exclusively for the purpose of enhancing education by assisting a public library with its physical and service needs.
- ILLITERACY PROGRAMS: Tangible personal property used or consumed by a nonprofit organization exempt under IRC Sec. 501(c)(3) and organized exclusively to combat illiteracy by tutoring and training adults and by increasing community awareness of the illiteracy problem in the Richmond metropolitan area. The Literacy Council of Metropolitan Richmond is the only organization known at this time to qualify for the exemption.
NOTES
LOCAL TAX
LEGISLATION
PROVISIONS SPECIFICALLY AFFECTING
LOCAL TAX OFFICIALS
Key Point to Remember:
- Commissioners of Revenue must deliver: all income tax payments to the Treasurer within 2 banking days and the Treasurer must deposit the funds on or before the next banking day
INDIVIDUAL INCOME TAX PAYMENTS
Senate Bill 857 (Chapter 485) requires Commissioners of Revenue to deliver all state income tax payments to the Treasurer within 2 banking days of receipt and further requires the Treasurer to deposit the funds to the State Treasury on or before the first banking day after receipt from the Commissioner of Revenue.
CODE SECTIONS AMENDED: §§ 58.1-307 and 2.1-198
DISCLOSURE OF INFORMATION TO TOWN TREASURERS
Senate Bill 515 (Chapter 448) requires the Commissioner of Revenue, upon request, to furnish to the Treasurer of any town located within the county the name, address, and Social Security number of any taxpayer who filed a tangible personal property tax return with the county. The town Treasurer must make the request in writing and certify that the information is for use in the performance of official duties. Any town Treasurer receiving information from the Commissioner of Revenue will be bound by the secrecy of tax information provisions of Va. Code § 58.1-3 and the penalties prescribed in that statute for unlawful disclosure of taxpayer information.
CODE SECTION AMENDED: § 58.1-3109
GENERAL LOCAL TAX PROVISIONS
Key Points to Remember:
- The periods of limitation for assessing and requesting refunds of local taxes are generally equalized
- Responsible corporate and partnership officers may be subject to a penalty for failure to pay or account for certain local "trust" taxes
PERIODS OF LIMITATION
Senate Bill 400 (Chapter 8):
- extends the period for investigating local license and personal property taxes from just the current year to the current and 3 preceding years;
- reduces the period in which a taxpayer may apply to the Commissioner of Revenue or Circuit Court for correction of an erroneous local tax assessment from 5 years to 3 years from the last day of the tax year for which the assessment eras made; and
- provides that penalty and interest on delinquent local taxes shall start from the day after the due date rather than the date of assessment.
CODE SECTIONS AMENDED: §§ 58.1-3109, 58.1-3980, and 58.1-3984
CORPORATE OFFICER LIABILITY
Senate Bill 756 (Chapter 481) provides that any responsible corporate or partnership officer or employee who willfully fails to pay, collect, or truthfully account for and pay over any admission, transient occupancy, meals, or daily rental property taxes, or who willfully attempts to evade or defeat such a tax shall be liable for a penalty equal to 100% of the tax evaded or not paid.
Responsible corporate or partnership officers and employees include those persons who were under a duty to perform on behalf of the corporation or partnership the act in respect of which the violation occurred and who had actual knowledge of the failure or attempt and had the authority to prevent the failure or attempt
TAX enjoys similar authority under existing law for purposes of collecting delinquent state taxes.
CODE SECTION ADDED: § 58.1-3906
COLLECTION OF TAX FROM THIRD PARTIES
House Bill 1911 (Chapter 445) includes the Commonwealth, its agencies, and political subdivisions among those from which a locality may obtain wages, property, or other amounts that may be owed to a taxpayer delinquent in paying local taxes.
However, in no event will the Commonwealth, an agency, or political subdivision incur any liability for failure to satisfy the locality's request
CODE SECTION AMENDED: § 58.1-3952
COLLECTION FEES
Senate Bill 838 (Chapter 271) increases the fee that localities can charge to cover the administrative costs associated with the collection of delinquent taxes from:
- $10 to $20 for taxes collected subsequent to the filing of a warrant or other appropriate legal document but prior to judgement, and
- $15 to $25 for taxes collected subsequent to judgement
PENALTIES AND INTEREST: LACK OF FAULT
A finding that a taxpayer was not at fault is necessary in order for a Commissioner of Revenue or Treasurer to waive assessment of late filing and/or payment penalties and interest.
House Bill 1502 (Chapter 493) provides that the failure to file a return or to pay a tax due to a medically determinable physical or mental impairment on the due date of a return and/or payment shall be presumptive proof of lack of fault on the taxpayer's part, provided that the return is filed and/or the tax is paid within 30 days of the due date. This presumption will not apply, however, if there is a committee, legal guardian or other fiduciary handling the taxpayer's affairs.
In addition, Senate Bill 817 (Chapter 484) provides that penalty and interest shall not be levied if the failure to file a return or pay the tax due was the fault of the Commissioner of Revenue or Treasurer.
CODE SECTION AMENDED: § 58.1-3916
JOINT TAX BILLS
House Bill 1294 (Chapter 187) authorizes any county and any town located within the county to issue joint tax bills for real estate and tangible personal property, provided approval is given by the local governing body of each locality.
The form of the joint bill is subject to approval by TAX.
CODE SECTION AMENDED: § 58.1-3912
PAYMENT DATES
Senate Bill 615 (Chapter 471) authorizes localities to provide for semiannual tax collections for either or both the real estate and tangible personal property taxes on June 5 and December 5.
Previous law provided that semiannual payment dates, if adopted, would apply to all four categories of real and tangible property (real property, tangible personal property, machinery and tools, and merchants capital).
CODE SECTION AMENDED: § 58.1-3916
PAYMENT DATES: CHESAPEAKE
House Bill 1769 (Chapter 509) authorizes any city with a population of more than 149,000 but less than 155,000, to adopt payment dates for business license and tangible personal property taxes which coincide with the payment dates established prior to January 1, 1984 by any contiguous jurisdiction. The City of Chesapeake is the only city known at this time to have a 1990 population within this range.
CODE SECTION AMENDED: § 58.1-3916
TAX SALE PROCEEDINGS
House Bill 1389 (Chapter 243) allows 2 or more parcels of real estate to be covered by one legal proceeding for the sale of land for delinquent taxes provided that each parcel is assessed at a value not exceeding $100,000. This authority exists under current law; however, the value of the parcels could not exceed $20,000. Parcels meeting the new assessed value test can be included in the same legal proceeding even if held by different owners.
CODE SECTION AMENDED: § 58.1-3968
PROVISIONS AFFECTING
LOCAL REAL ESTATE TAXES
Key Point to Remember:
- For localities providing tax relief programs for the handicapped, Social Security Administration disability certifications will now be acceptable for purposes of demonstrating permanent and total disability
TAX RELIEF FOR THE HANDICAPPED:
CERTIFICATION OF DISABILITY
House Bill 1468 (Chapter 286) provides that a certification of disability by the Social Security Administration pursuant to 42 U.S. Code Sec. 423(d) will be acceptable as proof that a person under age 65 is permanently and totally disabled for purposes of qualifying for local real estate tax relief for the handicapped.
CODE SECTION AMENDED: § 58.1-3213
TAX RELIEF FOR THE ELDERLY AND HANDICAPPED:
INCOME AND NET WORTH LIMITS
House Bill 1438 (Chapter 63) adds the City of Virginia Beach to the list of localities authorized to use higher combined income ($40,000) and combined net worth ($150,000) limitations for purposes of local real estate tax relief programs for the elderly and handicapped.
CODE SECTION AMENDED: § 58.1-3211
USE VALUE TAXATION
House Bill 1306 (Chapter 490) authorizes any county operating under the urban county executive form of government, i.e., Fairfax County, to provide for use value taxation in the open space category on qualifying parcels of land as small as 2 acres.
House Bill 1210 (Chapter 69) extends the same authority to York County for qualifying parcels of land located in the unincorporated Town of Yorktown.
CODE SECTION AMENDED: § 58.1-3233
BOARDS OF EQUALIZATION
Senate Bill 701 (Chapter 240) changes the expiration date of the term of a local Board of Equalization from 6 months to I year after the beginning of the year for which such board is appointed.
CODE SECTION AMENDED: § 58.1-3370
PROVISIONS AFFECTING
LOCAL TANGIBLE PERSONAL PROPERTY TAXES
Key Points to Remember:
- Localities are now authorized to provide tangible personal property tax relief to the elderly and handicapped
- New tangible personal property classifications have beep created for auxiliary police officers, handicapped veterans; and certain commercial airline maintenance, repair, rebuilding facilities
TAX RELIEF FOR THE ELDERLY AND HANDICAPPED
Implementing a 1990 Virginia constitutional amendment, Senate Bill 506 (Chapter 646) authorizes localities to provide tangible personal property tax relief for the elderly and handicapped, somewhat similar to the relief currently provided for real estate tax purposes.
The bill authorizes localities to prescribe a lower tax rate on only one vehicle owned by a qualifying individual. Qualification standards, including income and net worth limitations, are identical to the standards currently used for purposes of real estate tax relief for the elderly and handicapped.
TAX is currently developing a model ordinance for those localities choosing to provide tax relief pursuant to this act
CODE SECTIONS ADDED: §§ 58.1-3506.1 through 58.1-3506.8
CLASSIFICATIONS: DISABLED VETERANS
House Bill 2019 (Chapter 247) creates a separate classification of tangible personal property for disabled veterans. The establishment of a separate classification permits localities to exempt or tax at a lower rate any property within the classification.
This classification is limited to only one motor vehicle owned and regularly used by a veteran who has lost or lost the use of at least one hand, arm, or leg or who is blind or classified as permanently and totally disabled by the Department of Veterans' Affairs.
CODE SECTION AMENDED: § 58.1-3506
CLASSIFICATIONS: AUXILIARY POLICE OFFICERS
House Bill 1713 (Chapter 330) creates another classification of tangible personal property for motor vehicles owned by persons who have been appointed as auxiliary police officers pursuant to Va. Code § 15.1-159.2 et seq.
This classification is limited to only one motor vehicle that is regularly used by an auxiliary police officer to respond to auxiliary police duties.
In order to qualify, the officer must identify to the Commissioner of Revenue each January which vehicle should be included in the classification. In addition, the official or governing body responsible for the officer's appointment must furnish a certification that the individual is an auxiliary police officer
who regularly uses a motor vehicle to respond to auxiliary police duties and stating that the vehicle identified by the officer is the vehicle which is regularly used for auxiliary police duties. This certification must also be provided by the officer to the Commissioner of Revenue.
CODE SECTION AMENDED: § 58.1-3506
CLASSIFICATIONS: COMMERCIAL AIRLINES
Senate Bill 717 (Chapter 478) creates a separate classification of tangible personal property consisting of machinery and tools owned by a commercial air carrier and used in a commercial airline maintenance, repair, and rebuilding facility which has a total assessed value of at least $ 100 million and which is located on or contiguous to an airport.
CODE SECTION AMENDED: § 58.1-3506
AUTHORITY TO PRORATE TAX
House Bills 1142 (Chapter 6 I) and 1377 (Chapter 624) together add the counties of Alleghany, Botetourt, Henry, King George, and Louisa; the cities of Clifton Forge, Covington, Radford, and Salem; and the town of Glasgow to the list of localities authorized to prorate the tangible personal property tax on motor vehicles, trailers, and boats which acquire situs within the locality after January 1.
CODE SECTION AMENDED: § 58.1-3516
PRORATION: REPLACEMENT VEHICLES
House Bill 1377 (Chapter 624) requires a prorating locality to grant a credit against the tax due on a replacement vehicle of a taxpayer who has moved from a nonprorating locality.
- In order to qualify for the credit, the taxpayer must have replaced an original vehicle upon which the tax was actually due and paid to the nonprorating locality for the same tax year.
- The credit is equal to the amount of tax paid to the nonprorating locality for the period of time commencing with the disposition of the original vehicle and continuing through the close of the tax year.
PRORATION: CREDIT UPON MOVING
House Bill 1377 (Chapter 624) eliminates the requirement that a prorating locality issue a refund when a taxpayer moves from the locality to a nonprorating locality after January 1.
The bill does not eliminate the requirement for refunds when a taxpayer moves to another prorating locality.
CODE SECTION AMENDED: § 58.1-3516
VALUATION OF AUTOMOBILES: PRICING GUIDES
In determining the assessed value of an automobile using a recognized pricing guide, House Bill 1662 (Chapter 525) requires the Commissioner of Revenue either to:
- use all applicable adjustments in the guide, or
- use the base value listed in the guide (which may be average retail, wholesale, or loan value, so long as uniformly applied within classifications of property).
VALUATION OF AUTOMOBILES: ORIGINAL PRICE
For purposes of determining the assessment on an automobile not listed in a recognized pricing guide, House Bill 1250 (Chapter 253) permits taxpayers to furnish the Commissioner of Revenue with proof of the automobile's purchase price and the basis of the motor vehicle sales and use tax paid on the automobile.
The pricing information furnished by the taxpayer will constitute proof of the original purchase price; however, the Commissioner may select another method of valuation if the original cost does not reflect the automobile's fair market value-or if the taxpayer does not furnish proof of the automobile's original cost.
CODE SECTION AMENDED: § 58.1-3503
PROVISIONS AFFECTING
LOCAL BUSINESS LICENSE TAXES
Key Points to Remember:
- Nonprofit hospitals and institutions of learning will generally be exempt from the tax until July 1, 1993
- Localities may prevent the issuance of a business license until the business has paid all delinquent license, tangible personal property, and taxes collected from others (meals, transient occupancy, and admissions):
NONPROFIT HOSPITALS AND INSTITUTIONS OF LEARNING
House Bill 1492 (Chapter 572) and Senate Bill 736 (Chapter 540) exempt from local license taxes all hospitals, colleges, universities, and other institutions of learning which are exempt from federal income taxes, except where an ordinance taxing such organizations was enacted by a local governing body prior to January 15, 1991.
The exemption will expire, however, on July 1, 1993, unless reenacted.
CODE SECTION AMENDED: § 58.1-3703
DENIAL OF LICENSE
Senate Bill 757 (Chapter 267) authorizes local governing bodies to require the payment of all delinquent business license, business personal property, meals, transient occupancy, and admissions taxes owed to the locality before the issuance of a license to the business.
CODE SECTION AMENDED: § 58.1-3700
STATE-CHARTERED CREDIT UNIONS
House Bill 1596 (Chapter 430) limits the local license tax on state-chartered credit unions to an amount not to exceed $50 and provides that the tax shall be levied only where the main office of the credit union is located.
CODE SECTION AMENDED: § 58.1-3730
COAL AND GAS ROAD IMPROVEMENT TAX
House Bill 1140 (Chapter 393) extends the expiration date of the coal and gas road improvement tax from December 31, 1992 to December 31, 1995.
INDEX
BY BILL NO.
Bill No. Chapter No. Subject Matter Page
HB-1140 393 Coal and Gas Road Improvement Tax
HB-1142 261 Authority to Prorate Tax
HB-1210 69 Use Value Taxation: Town of Yorktown
HB-1250 253 Valuation of Automobiles: Original Price
HB-1294 187 Joint Tax Bills
HB-1306 490 Use Value Taxation: Fairfax County
HB-1366 565 Sales and Use Tax: Out-of-State Dealers
HB-1377 624 Authority to Prorate Tax
Proration: Replacement Vehicles
Proration: Credit Upon Moving
HB-1389 243 Tax Sale Proceedings
HB-1438 63 Tax Relief for the Elderly and Handicapped:
-
-
-
- Income and Net Worth Limits
-
-
-
-
-
-
-
- of Disability
-
-
-
-
HB-1502 493 Penalties and Interest Lack of Fault
HB-1521 287 Income Tax: Credit for Substance Abuse Advertising
HB-1596 430 State-Chartered Credit Unions
HB-1662 525 Valuation of Automobiles: Pricing Guides
HB-1698 361 Operation Desert Storm
HB-1713 330 Classifications: Auxiliary Police Officers
HB-1734 362 Extensions
Period of Limitations
Credit for Income Tax Paid to Another State
Estimated Tax Underpayment Penalty
Income Tax Withholding: Definition of Wages
Income Tax Withholding: 8th Monthly Filers
HB-1769 509 Payment Dates: Chesapeake
HB-1830 331 Penalties and Interest .
HB-1911 445 Collection of Tax from Third Parties
HB-1948 714 Tax Litigation
HB-2019 247 Classifications: Disabled Veterans
SB-400 8 Periods of Limitation
SB-506 646 Tax Relief for the Elderly and Handicapped
SB-515 448 Disclosure of Information to Town Treasurers
SB-524 647 Sales Tax Exemption-Certain Day Care Centers
Sales Tax Exemption-Public Library/
-
-
-
-
-
- Recreation Center
-
-
-
-
-
- Sales Tax Exemption-Free Enterprise Education
-
-
-
- Organizations
-
-
-
- Sales Tax Exemption-Free Enterprise Education
Bill No. Chapter No. Subject Matter Page
SB-524 647 Sales Tax Exemption-Farmers
Sales Tax Exemption-Volunteer Fire Department/
Rescue Squads
Sales Tax Exemption-Meals on Wheels Programs
Sales Tax Exemption-Science-Technology Programs
Sales Tax Exemption-Heart Associations
Sales Tax Exemption-Lung Associations
Sales Tax Exemption-Diabetes Associations
Sales Tax Exemption-Cancer Associations
Sales Tax Exemption- Conservation Organizations
-
-
-
- Sales Tax Exemption-Women's Centers Sales Tax
Sales Tax Exemption-Sporting Associations
Sales Tax Exemption-Lions Clubs
Sales Tax Exemption-REACT Teams
- Sales Tax Exemption-Women's Centers Sales Tax
-
-
-
-
-
-
-
- Library Organizations
-
-
-
-
SB-584 173 Refund Check-Off
SB-615 471 Payment Dates
SB-700 179 Refund Check-Off
SB-701 240 Boards of Equalization
SB-717 478 Classifications: Commercial Airlines
SB-736 540 Nonprofit Hospitals and Institutions of Learning
SB-739 316 Penalties and Interest
SB-756 481 Corporate Officer Liability
SB-757 267 Denial of License
SB-765 456 Extensions
Period of Limitations
Credit for Income Tax Paid to Another State
Estimated Tax Underpayment Penalty
-
-
-
- Income Tax Withholding: Definition of Wages
Income Tax Withholding. 8th Monthly Filers
- Income Tax Withholding: Definition of Wages
-
-
SB-782 544 Sales and Use Tax: Out-of-State Dealers
SB-791 346 Operation Desert Storm
SB-838 271 Collection Fees
SB-857 485 Individual Income Tax Payments
SB-1504 Sp. I Sales Tax Exemption-Arts Center
INDEX
BY CODE SECTION
Va. Code § Bill No. Subject Matter Page
2.i-198 SB-857 Individual Income Tax Payments
58.1-15 HB-1830 Penalties and Interest
58.1-15 SB-739 Penalties and Interest
58.1-104 HB-1734 Period of Limitations
58.1-104 SB-765 Period of Limitations
58.1-307 SB-857 Individual Income Tax Payments
58.1-322 HB-1698 Operation Desert Storm
58.1-322 SB-791 Operation Desert Storm
58.1-323.1 SB-770 Corporation Income Tax: ACRS Subtractions
58.1-332 HB-1734 Credit for Income Tax Paid to Another State
58.1-332 SB-765 Credit for Income Tax Paid to Another State
58.1-339.1 HB-1521 Income Tax: Credit for Substance Abuse Advertising
58.1-344 HB-1734 Extensions
58.1-344 SB-765 Extensions
58.1-344 HB-1698 Operation Desert Storm
58.1-344 SB-791 Operation Desert Storm
58.1-344.1 HB-1698 Operation Desert Storm
58.1-344.1 SB-791 Operation Desert Storm
58.1-346.3 SB-584 Refund Check-Off
58.1-346.4 SB-700 Refund Check-Off
58.1-347 HB-1830 Penalties and Interest
58.1-347 SB-739 Penalties and Interest
58.1-351 HB-1830 Penalties and Interest
58.1-351 SB-739 Penalties and Interest
58.1-355 HB-1698 Operation Desert Storm
58.1-355 SB-791 Operation Desert Storm
58.1-437 HB-1521 Income Tax: Credit for Substance Abuse Advertising
58.1-450 HB-1830 Penalties and Interest
58.1-450 SB-739 Penalties and Interest
58.1-453 HB-1734 Extensions
58.1-453 SB-765 Extensions
58.1-455 HB-1830 Penalties and Interest
58.1-455 SB-739 Penalties and Interest
58.1-460 HB-1734 Income Tax Withholding Definition of Wages
58.1-460 SB-765 Income Tax Withholding Definition of Wages
58.1-472 HB-1734 Income Tax Withholding: 8th Monthly Filers
58.1-472 SB-765 Income Tax Withholding: 8th Monthly Filers
58.1-475 HB-1830 Penalties and Interest
58.1-475 SB-739 Penalties and Interest
58.1-491.1 HB-1698 Operation Desert Storm
58.1-491.1 SB-791 Operation Desert Storm
58.1-492 HB-1734 Estimated Tax Underpayment Penalty
58.1-492 SB-765 Estimated Tax Underpayment Penalty
58.1-608 SB-1504 Sales Tax Exemption-Arts Center
BY CODE SECTION
Va. Code § Bill No. Subject Matter Page
58.1-608 SB-524 Sales Tax Exemption-Certain Day Care Centers
58.1-608 SB-524 Sales Tax Exemption-Public Library/Recreation Center
58.1-608 SB-524 Sales Tax Exemption-Public Libraries
58.1-608 SB- 524 Sales Tax Exemption-Free Enterprise Education
Organizations
58.1-608 SB-524 Sales Tax Exemption-Farmers
58.1-608 SB-524 Sales Tax Exemption-Volunteer Fire Department/
Rescue Squads
58.1-608 SB-524 Sales Tax Exemption-Meals on Wheels Programs
58.1-608 SB-524 Sales Tax Exemption-Science-Technology Programs
58.1-608 SB-524 Sales Tax Exemption-Heart Associations
58.1-608 SB-524 Sales Tax Exemption-Lung Associations
58.1-608 SB-524 Sales Tax Exemption-Diabetes Associations
58.1-608 SB-524 Sales Tax Exemption-Cancer Associations
58.1-608 SB-524 Sales Tax Exemption-Conservation Organizations
58.1-608 SB-524 Sales Tax Exemption-Women's Centers
58.1-608 SB-524 Sales Tax Exemption-Sporting Associations
58.1-608 SB-524 Sales Tax Exemption-Lions Clubs
58.1-608 SB-524 Sales Tax Exemption-REACT Teams
58.1-608 SB-524 Sales Tax Exemption-Friends of the Public
Library Organizations
58.1-608 SB-524 Sales Tax Exemption-Illiteracy Programs
58.1-612 HB-1366 Sales and Use Tax Out-of-State Dealers
58.1-612 SB-782 Sales and Use Tax: Out-of-State Dealers
58.1-635 SB-0739 Penalties and Interest
58.1-635 HB-1830 Penalty and Interest
58.1-905 HB-1698 Operation Desert Storm
58.1-905 SB-791 Operation Desert Storm
58.1-1510 HB-1830 Penalties and Interest
58.1-1510 SB-739 Penalties and Interest
58.1-1825 HB-1948 Tax Litigation
58.1-3109 SB-515 Disclosure of Information to Town Treasurers
58.1-3109 SB-400 Periods of Limitation
58.1-3211 HB-1438 Tax Relief for the Elderly and Handicapped: Income and Net Worth Limits
58.1-3213 HB-1468 Tax Relief for the Handicapped: Certification of Disability
58.1-3219.1 HB 1830 Penalties and Interest
58.1-3219.1 SB-739 Penalties and Interest
58.1-3233 HB-1306 Use Value Taxation: Fairfax County
58.1-3233 HB-1210 Use Value Taxation: Town of Yorktown
58.1-3370 SB-701 Boards of Equalization
58.1-3503 HB-1662 Valuation of Automobiles: Pricing Guides
58.1-3503 HB-1250 Valuation of Automobiles: Original Price
58.1-3506 HB-2019 Classifications: Disabled Veterans
58.1-3506 HB-1713 Classifications: Auxiliary Police Officers
58.1-3506 SB-717 Classifications: Commercial Airlines
BY CODE SECTION
Va. Code § Bill No. Subject Matter Page
58.1-3506.8 SB-506 Tax Relief for the Elderly and Handicapped
58.1-3506.1 SB-506 Tax Relief for the Elderly and Handicapped
58.1-3516 HB-1142 Authority to Prorate Tax
58.1-3516 HB-1377 Authority to Prorate Tax
58.1-3516 HB-1377 Proration: Replacement Vehicles
58.1-3516 HB-1377 Proration: Credit Upon Moving
58.1-3700 SB-757 Denial of License
58.1-3703 HB-1492 Nonprofit Hospitals and Institutions of Learning
58.1-3703 SB-736 Nonprofit Hospitals and Institutions of Learning
58.1-3730 HB-1596 State-Chartered Credit Unions
58.1-3906 SB-756 Corporate Officer Liability
58.1-3912 HB-1294 Joint Tax Bills
58.1-3916 HB-1502 Penalties and Interest Lack of Fault
58.1-3916 SB-615 Payment Dates
58.1-3916 HB-1769 Payment Dates: Chesapeake
58.1-3952 HB-1911 Collection of Tax from Third Parties
58.1-3958 SB-838 Collection Fees
58.1-3968 HB-1389 Tax Sale Proceedings
58.1-3980 SB-400 Periods of Limitation
58.1-3984 SB-400 Periods of Limitation
Rulings of the Tax Commissioner