Tax Type
Corporation Income Tax
Description
Consolidated returns; Affiliated corporations
Topic
Returns/Payments/Records
Date Issued
06-19-1992
June 19, 1992
Re: Ruling Request: Corporation Income Tax
Dear**********************
This will reply to your letter dated February 19, 1992 in which you request permission for****************(the "Taxpayers") to file a Virginia consolidated income tax return.
FACTS
The taxpayers are brother-sister corporations. One affiliate has been filing in Virginia for a number of years, and the second affiliate began in Virginia in 1991. Both taxpayers participate in a federal consolidated return.
DETERMINATION
Va. Code §58.1-442 allows corporations to elect to file returns on the basis of one of three filing statuses (separate, combined, or consolidated) regardless of how the corporations filed their federal income tax return. Once an affiliated group has made an election, the group may not change its filing status unless permission is granted by the Department of Taxation.
Virginia Regulation (VR) 630-3-442.A provides that the election of return filing status is made the first year two or more affiliated corporations are required to file Virginia tax returns. In this case, the taxpayer's initial election occurs in 1991, the first year two or more affiliates are subject to Virginia income tax.
Accordingly, permission is granted to elect the consolidated filing basis for the taxpayers.
Sincerely,
W. H. Forst
Tax Commissioner
TPD/6006G
Rulings of the Tax Commissioner