Tax Type
Corporation Income Tax
Description
Foreign Source Income
Topic
Collection of Tax
Date Issued
03-14-1994
March 14, 1994
Re: §58.1-1821 Application: Corporate income taxes
Dear*********
This will reply to your letter of July 23, 1993 in which you applied for correction of the assessments of additional corporate income taxes to ***********(the "Taxpayer") for the taxable years ended December 31, 1989 and 1990.
FACTS
The Taxpayer was field audited, and numerous adjustments were made. You contest the adjustments made with respect to foreign source income, and aver that technical fees from consulting services performed outside the United States qualify for the Virginia foreign source income subtraction.
RULING
It is the long standing policy of the department that the words "technical fees from ... services performed" cannot be taken out of their context to create a subtraction for income earned from the performance of services outside the United States for any service which can be characterized as of a technical nature. See Public Documents 92-44 (4/27/92) and 86-209 (11/3/86), copies attached. Accordingly, the assessment is upheld.
The total assessment with accrued interest, ********* per the attached schedule, should be paid within 30 days to prevent the accrual of additional interest.
Sincerely,
Danny M. Payne
Acting Tax Commissioner
OTP/7239M
Rulings of the Tax Commissioner