Tax Type
Corporation Income Tax
Description
Time limitations for assessment and collection; Amended returns
Topic
Collection of Tax
Date Issued
03-29-1994
March 29, 1994
Re: §58.1-1821 Application: Corporate income taxes
Dear*********
This will reply to your letter of December 22, 1993 in which you apply for correction of assessments for additional corporate income taxes to********** (the "Taxpayer") for the 1989 taxable year.
FACTS
The Taxpayer is a corporation headquartered outside of Virginia in State A. In 1992 the Taxpayer determined that it owed income taxes to Virginia in addition to State A, and entered into a voluntary compliance agreement with the department on June 1, 1992. The Taxpayer filed a Virginia return for the 1989 taxable year in June 1992. In June of 1993, the Taxpayer filed an amended Virginia return claiming a refund for the 1989 taxable year, which was disallowed due to the statute of limitations. You contest this determination, and believe that the amended return should be considered to have been timely filed.
DETERMINATION
Pursuant to Va. Code §58.1-1823, any person filing a tax return may file an amended tax return with the department:
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- "[within] three years from the last day prescribed by law for the timely filing of the return;... within ninety days from the final determination of any change or correction in the liability of the taxpayer for any federal tax upon which the state tax is based, whichever is later, ... or... within one year from the filing of an amended Virginia return resulting in the payment of additional tax..."
In the instant case, the Taxpayer does not contend that there was a final determination of any change or correction in the liability of the for federal tax, or that there was a previous filing of an amended Virginia return. The issue therefore, is what constitutes the last day prescribed by law for filing the return.
Va. Code §58.1-441 provides that "every corporation organized under the laws of the Commonwealth, or having income from Virginia sources, shall make a report to the Department on or before the fifteenth day of the fourth month following the close of its taxable year."
The Taxpayer contends that because no Virginia tax is actually due (per the amended return) a Virginia extension should be implied, which would extend the due date of this return to October 15, 1990. Following the Taxpayer's analysis, the amended return would have been filed within three years of the extended due date. The Taxpayer also contends that the voluntary compliance agreement created a new due date in June 1992 for the returns filed pursuant to the agreement.
Neither the Code of Virginia nor the regulations thereunder provide for a Virginia extension where a timely request for such extension was not filed with the department. The voluntary compliance agreement entered into with the Taxpayer only provided for the waiver of late filing and understatement penalties. However, the agreement required that the tax due and applicable interest would be paid. There is nothing in the agreement that implies that the due date for the return was extended. In fact, the requirement for the payment of interest clearly implies otherwise. Furthermore, an extension to June 1992 would have more than six months, the maximum period permitted by Va. Code §58.1-453.
There is nothing in the Code of Virginia that authorizes the Tax Commissioner to allow a refund of taxes beyond the statutory period of limitations provided by Va. Code §58.1-1823. Having reviewed the facts of your protest, I find no basis or authority under which a refund may be permitted. Accordingly, your protest is hereby denied.
Sincerely,
Danny M. Payne
Acting Tax Commissioner
OTP/7577M
Rulings of the Tax Commissioner