Tax Type
Individual Income Tax
Description
Refund statute of limitations
Topic
Payment and Refund
Statute of Limitations
Date Issued
04-27-1992
April 27, 1992
Re: Section 58.1-1821 Application: Individual Income Tax
Dear ****
This will reply to your letter of October 23, 1991, in which you request a refund for taxable year 1985.
FACTS
You claim to have mailed your 1985 individual income tax return to the department on or about December 17, 1986, along with your 1984 return. The department processed your 1984 return, but has no record of receiving the 1985 return.
On April 5, 1990 you contacted the department to inquire about the 1985 return and seek a refund of taxes overpaid for that year. A representative of the department responded that a refund was not possible due to the expiration of the period of limitations for taxable year 1985 refunds. You request reconsideration of this decision due to the possibility that the return was received by the department in 1986.
DETERMINATION
Although I empathize with your position, Virginia law is quite clear in this matter. Va. Code Section 58.1-1823 provides a three year period from the due date of a return in which to request a refund.
In your case, a return requesting a refund for taxable year 1985 may have been filed; however, the department has no record of receiving the return. Had you initiated an inquiry on the status of the refund during the period of limitations, a refund would have been issued. However, because your first inquiry on the 1985 refund came more than three years after the return's May 1, 1986 due date, Va. Code Section 58.1-1823 now precludes me from authorizing a refund.
The statute provides taxpayers with a reasonable amount of time to request refunds of overpaid taxes, or in cases such as yours to question why a refund has not been issued. It is also instructive to note that in all but exceptional cases, i.e., tax fraud or failure to file a return, the same three-year period of limitations applies to the department for the assessment of additional taxes. In the case of erroneous (excessive tax refunds that are issued by the department, the period of limitations for recovery from the taxpayer is only two years.
Sincerely,
W. H. Forst
Tax Commissioner.
Rulings of the Tax Commissioner