Tax Type
General Provisions
Description
1996 Legislative Summary
Topic
Rate of Tax
Date Issued
06-30-1996
1996
LEGISLATIVE
SUMMARY
LEGISLATIVE
SUMMARY
Virginia
Department of Taxation
Department of Taxation
Danny M. Payne
Tax Commissioner
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 1996 Session of the General Assembly. It includes a general description of enacted legislation affecting:
C State taxes administered by TAX, and
C Local taxes which TAX administers or on which TAX renders advisory assistance.
The Summary also includes legislative studies in which TAX will be directly involved or acting in a technical support role. However, in general, legislation granting property tax exemptions, creating special taxing jurisdictions or affecting taxes administered by other state agencies is not included in the Summary.
The Summary is intended to provide a synopsis 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
Employer Withholding Tax (804) 367-8038
Voice/TDD (804) 367-8329
Additional information on new local tax legislation should be obtained from your local Commissioner of Revenue or Treasurer.
Virginia Department of Taxation
June 1996
June 1996
TABLE OF CONTENTS
Subject Page
STATE TAX LEGISLATION . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1
GENERAL PROVISIONS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2
Disclosure of Confidential Tax Information: Probate Tax Returns . . . . . . . . . . . . . . . . . 2
Disclosure of Confidential Tax Information by Commissioners of Revenue . . . . . . . . . 2
Disclosure of Confidential Tax Information by Commissioners of Revenue . . . . . . .. . 2
Electronic Filing/Signature Authorization . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . ......3
Penalty Waivers, Filing Extensions, and Filing Frequencies . . . . . . . . . . . . . . . . . . ...... .3
Taxpayer Bill of Rights . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . ....... . . . 3
INCOME TAX . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5
Corporations
Day-care Facility Investment Tax Credit . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5
Low-income Housing Credit . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . ... 5
Major Business Facility Job Tax Credit . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5
Tax Credit for Rent Reductions . . . . . . . . . . . . . . . . . . . . .. . . . . . . . . . . . . . . . . . . . . . .. 6
Historic Rehabilitation Tax Credit . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . ... . . 6
Coalfield Employment Enhancement Tax Credit . . . . . .. . . . . . . . . . . . . . . . . . . . . . . . 6
Recycling Tax Credit . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . ...... . . . . . . . . . . . 7
Enterprise Zones: Waiver of Employment Eligibility Criteria . . . . . . . . . . . . . . . . . . . . . 7
Individuals
Retirement Plan Contributions Subtraction . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . ....7
Tax Relief for Participants in OPERATION JOINT ENDEAVOR . . . . . . . . . . . . . . . . . 8 Neighborhood Assistance Act Credit . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .... . 8
Open Space Recreation and Conservation Fund Refund Check-off . . . . . . . . . . . . . . . 9
Political Party Contribution Refund Check-off . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . ... 9
Advanced Technology Pesticide and Fertilizer Application Equipment Credit . . . . . . . . 9
Agricultural Best Management Practices Tax Credit . . . . . . . . . . . . . .. . . . . . . . . . . . ... 10
Signing Estimated Tax Returns . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .... 10
Federal Retirees: Period for Filing Claims Extended . . . . . . . . . . . . . . . . .. . . . . . . . . .. . 10
.
Employer Withholding
Withholding Allowance Adjustment Deferred . . . . . . . . . . .... . . . . . . . . . . . . . . . . . . . . 11
RETAIL SALES AND USE TAX . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 12
Prescription Medicines and Drugs Exemption Expanded . . . . . . . . . . . . . . . . . . . . . . ... 12 Organization Supporting a Medical College . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . ... ... . 12
Various Exemptions - Extended, Expanded, and New . . . . . . . . . . . . . . . . . . . . . . . . .... 13 Nonprescription Drugs Exemption Deferred . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .... . 14
Maintaining Tax Exempt Status of Nonprofit Organizations . . . . . . . . . . . . . . . . . . . . ... 14
Virginia Baseball Stadium Authority . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .... 15
Expenditure Study Eliminated; Sales and Use Tax Exemptions . . . . . . . . . . . . . . . . ... . 15
TABLE OF CONTENTS
Subject Page
TAX COLLECTION & ADMINISTRATION . . . . . . . . . . . . . . . . . . . . . . . . . . . . ....... . . . 16
Tax Department Address and Phone Number Included in Instructions . . .. . . . ..... 16
Electronic Funds Transfer . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .. . 16
Public - Private Partnerships . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .... 16
Amended Returns: Statute of Limitations for Claiming a Refund . . . . . . . . . . . . . . . 17
Setoff Debt Collection Act - Administrative Changes . . . . . . . . . . . . . . . . . . . . . . . . 17
Contract Collectors of Delinquent Tax Accounts . . . . . . . . . . . . . . . . . . . . . . . . . .. . . 18
LOCAL TAX LEGISLATION . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . ............ 19
TANGIBLE PERSONAL PROPERTY TAX . . . . . . . . . . . . . . . . . . . . . . . . . . . . . ......... . 20
Special Classification for Programmable Computer Equipment . . . . . . . . . . . . . . . . ............. 20
Alternative Filing Method for Trailers and Boats . . . . . . . . . . . . . . . . . . . . . . . . . . ................ 20
Machinery and Tools Used in Semiconductor Manufacturing or Food Processing . ............ . 20
Common Carriers of Property by Motor Vehicle . . . . . . . . . . . . . . . . . . . . . . . . . . ............... . 20
Proration of Motor Carrier Property Used in Interstate Commerce . . . . . . . . . . . . . . ............. 21
Definition of Motor Carrier Transportation Property . . . . . . . . . . . . . . . . . . . . . . . . ................ 21
Late Filing of Certifications for Special Classification of Motor Vehicles Owned
by Volunteer Rescue Squad and Fire Department Members and Auxiliary
Police Officers . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . ...... . . . . 21
Property Leased by Volunteer Rescue Squad or Fire Department Members . . . ............... 21
Manufacturers' Office Equipment as Capital . . . ................ . . . . . . . . . . . . . . . . . . . . . . . . . 22
REAL ESTATE TAX . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .............. . . . . . . . . . . . . . . . . 23
Taxation of Leasehold Interests in Exempt Property of Churches . . ... . . . . . . . . . 23
Application for Exemption by Elderly and Handicapped Persons . . . . . . ... . . . . . . . 23
Credits on Rehabilitated Residential Property . . . . . . . . . . . . . . . . . . . . ..... . . . . . . . 23
BPOL . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . ................... . . 24
Uniform Ordinance . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .............................. . . . . . . . . . . . 24
MISCELLANEOUS TAXES . . . . . . . . . . . . . . . . ................... . . . . . . . . . . . . . . . . . . . . . . . . . 27
Coal and Gas Road Improvement Tax ...
Allocation of Revenue for Water Projects . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . ........ 27
Transient Occupancy Tax
Arlington County Sunset Date Extended . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .......... 27
Chesterfield, Hanover, and Henrico Allowed to Impose Additional Tax . . . . . . . . . . ......... 27
Arlington, Loudoun, Nelson, Spotsylvania, and York Allowed to Impose
Maximum 5 % Tax . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 28
Admissions Tax
Virginia Baseball Stadium Authority . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .. 28
TABLE OF CONTENTS
Subject Page
TAX EXEMPT PROPERTY . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . ........... . . . . . 29
Local Technology Zones for Cities, Counties, and Towns . . . . . . . . . . . . . . . . . . . . 29
Property Leased for Charitable Purposes . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .............. . 29
TAX COLLECTION & ADMINISTRATION . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 30
Time Limitation on Changes in Tax Rates . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 30
Priority of Liens . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . ............... 30
Third Party Agreements for Payment of Local Taxes . . . . . . . . . . . . . . . . . . . . . ........... . . 30
Powers and Duties of Treasurers and Commissioners of Revenue . . . . . . . . . . . . . .......... 30
Receipts for Payments Made in Cash or by Money Order . . . . . . . . . . . . . . . . . . . ........... 31
Willful Failure to Collect and Account for Daily Rental Property Tax . . . . . . . . . . . ............. 31
LEGISLATIVE STUDIES . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . ........ . . . . . .. 32
INDEXES
STATE TAX
LEGISLATION
GENERAL PROVISIONS
Disclosure of Confidential Tax Information: Probate Tax Returns - New
Senate Bill 569 (Chapter 614) authorizes disclosure of copies of or information contained in an estate's probate return when requested by beneficiaries of an estate or heirs at law of a decedent. Probate tax returns are returns for the state tax on wills and grants of administration. They are filed with the clerk of the circuit court at the time a person offers a will for probate, or seeks a grant of administration of a decedent's estate. The tax is imposed by the Commonwealth on the probate of every will or grant of administration not exempt by law.
Disclosure of copies of or information from state tax returns such as income and estate taxes is governed by Virginia Regulation (VR) 630-1-3(C)(5). This regulation interprets Code of Virginia § 58.1-3 to provide that an heir at law or beneficiary under the will or trust agreement may be given confidential state tax information related to an estate or trust if the heir or beneficiary has a financial interest which will be affected by the information.
Effective Date: July 1, 1996
Code Section Amended: § 58.1-3
Disclosure of Confidential Tax Information by Commissioners of Revenue - New
Senate Bill 218 (Chapter 784) and House Bill 423 (Chapter 793) would allow local commissioners of the revenue to disclose local tax returns and return information to the Tax Commissioner. Local tax officials are currently authorized to obtain state tax information from the department by written request. This legislation allows commissioners of revenue to disclose local tax returns and tax information to the department, provided the department's request is in writing and the request states the reason the information is needed.
Effective Date: July 1, 1996
Code Section Amended: § 58.1-3
Disclosure of Confidential Tax Information by Commissioners of Revenue - New
House Bill 733 (Chapter 988) allows commissioners of revenue to furnish the name, address, and gross receipts of a person, firm, or entity to the Department of Professional and Occupational Regulation for purposes of criminal investigation.
Effective Date: July 1, 1996
Code Section Amended: § 58.1-3
Electronic Filing/Signature Authorization - New
House Bill 766 (Chapter 657) and Senate Bill 166 (Chapter 635) allow the electronic filing of state tax returns, statements, or documents, and allow the Tax Commissioner to determine alternative methods for signing a state tax return to support the electronic receipt of tax returns and payments. Alternative methods of signing to support these initiatives and streamline the processing of electronic data include PIN numbers, authorization codes, digitized signatures, and voice signatures, in lieu of a written signature. These initiatives are a part of an ongoing effort to streamline the tax filing process for both taxpayers and the department. The filing alternatives being developed include electronic funds transfer (EFT) and electronic filing. The department has identified tele-filing and fax filing programs as future initiatives.
Effective Date: July 1, 1996
Code Section Amended: § 58.1-9
Penalty Waivers, Filing Extensions, and Filing Frequencies - New
Senate Bill 210 (Chapter 640) and House Bill 588 (Chapter 655) codify the department's administrative practice of waiving penalties for reasonable cause prior to assessment in certain cases. In addition, the legislation codifies the department's administrative practice of granting blanket filing extensions and waiving penalties in the case of natural disasters or when the circumstances so indicate. The department is also granted discretion in allowing certain tax returns to be filed less frequently than currently required by law.
The penalty and extension provisions of these bills codify existing extension and penalty waiver procedures. In certain circumstances, the department has noted that penalty assessments would qualify for waiver as an offer in compromise under existing law, if the taxpayer writes to request it. This will ensure that taxpayers will not be required, in all instances, to follow a rigid formal process that involves writing a letter or filing a form in order to obtain a penalty waiver.
This bill also permits the department to require certain tax returns be filed less frequently than currently required by law. For example, withholding tax returns are required to be filed by employers monthly when their average liability exceeds $100 per month. This $100 threshold has not been changed since withholding was first required in 1962. The department now has the authority to change such a filing requirement.
Effective Date: April 5, 1996
Code Section Amended: § 58.1-105
Code Section Added: § 58.1-112
Taxpayer Bill of Rights - New
House Bill 1451 (Chapter 634) establishes a "Taxpayer Bill of Rights" that provides for the following: (1) allows taxpayers 14 days in which to contest jeopardy assessments and requires a response by the Department of Taxation within 20 days of a meeting; (2) creates a statutory framework for allowing installment payment plans for outstanding tax liabilities; (3) creates a taxpayer resolution program and provides for a taxpayer rights advocate and adequate staff to administer the program; (4) requires the Department of Taxation to provide a written explanation of audit and collection processes; allows a taxpayer to be represented at meetings, to suspend meetings to consult with a representative; allows taxpayers and the department to record meetings; and (5) the abatement of penalty, interest or tax attributable to erroneous advice from the Department of Taxation.
Effective Date: July 1, 1997
Code Sections Amended: §§ 58.1-202, 58.1-307, 58.1-313, and 58.1-1805
Code Sections Added: §§ 58.1-1817, 58.1-1818, 58.1-1834, 58.1-1835, and 58.1-1845
INCOME TAX
Corporations
Day-Care Facility Investment Tax Credit - New
House Bill 720 (Chapter 497) creates an investment tax credit for any employer who establishes a licensed child day-care center for the children of employees. The credit is equal to 25% of the cost of the facility, not to exceed $25,000. The total amount of credits allowed in any fiscal year is limited to $100,000. Qualifying expenditures include those paid or incurred by the taxpayer for planning, site preparation, construction, renovation, or acquisition of facilities for the purpose of establishing a child day-care facility. Expenditures would also include equipment and kitchen appliances permanently installed in or adjacent to the facility. This equipment qualifies to the extent it is necessary to the functioning of the facility as a day-care.
Effective Date: Taxable years beginning on or after January 1, 1997
Code Section Added: § 58.1-439.4
Low-Income Housing Credit - Deferred
House Bill 1474 (Chapter 580) and Senate Bill 421 (Chapter 826) defer from 1996 to 1998 the provisions of the Virginia low-income housing credit. The low-income housing credit is the state version of a similar federal credit. Both individuals and corporations are entitled to the Virginia credit if they receive the equivalent federal credit. The amount of credit per taxpayer is certified by the Department of Housing and Community Development as a percentage of the federal credit. The aggregate of all credits certified cannot exceed $3.5 million annually.
Effective Date: Taxable years beginning on or after January 1, 1996, for low-income housing units placed in service on or after January 1, 1998
Code Sections Amended: § 36-55.63, § 58.1-336, and § 58.1-435
Major Business Facility Job Tax Credit - Administrative Change
House Bill 305 (Chapter 874) requires the Department of Taxation to certify those companies which qualify for the Major Business Facility Job Tax Credit and determine the classification of facilities. The Department of Economic Development had performed these functions.
Effective Date: Taxable years beginning on or after January 1, 1995, but before January 1, 2005
Code Section Amended: § 58.1-439
Tax Credit for Rent Reductions - Extended
House Bill 1503 (Chapter 521) extends for three years the tax credit for landlords who provide reduced rental units to low income tenants who are either elderly or disabled. However, the credit would only be available for units rented to qualifying tenants as of July 1, 1996, and would further be restricted to rent received from tenants in residence as of July 1, 1996. Beginning July 1, 1996, the total amount of approved credits may not exceed $250,000 in any fiscal year.
The tax credit for rent reductions is available to landlords engaged in the business of renting dwelling units and subject to the Virginia Residential Landlord and Tenant Act. The Virginia Housing Development Authority certifies to the Department of Taxation the individuals or corporations providing rent reductions that qualify for the credit. If a qualifying landlord provides rentals to low income tenants who either exceed the age of 62 or are disabled from a physical or mental condition, and the rent charged is at least 15% less than market value, a credit equal to 50% of the rental reductions shall be allowed the landlord.
Effective Date: Through December 31, 1999, but restricted to dwelling units rented as of June 30, 1996, and to tenants occupying units on June 30, 1996
Code Section Amended: § 58.1-339
Historic Rehabilitation Tax Credit - New
House Bill 1453 (Chapter 520) provides an income tax credit to individuals, trusts and estates, and corporations equal to a designated percentage of the eligible expenses incurred in rehabilitating a certified historic structure. The percentage of expenses qualifying for the credit will be phased in as follows:
Year Percentage
1997 10%
1998 15%
1999 20%
2000 and thereafter 25%
In order to qualify, the cost of the rehabilitation must equal at least 50% of the assessed value of the building for local real estate tax purposes in the year prior to the rehabilitation. Certification for the credit must be obtained from the Virginia Department of Historic Resources.
Effective Date: Taxable years beginning on and after January 1, 1997
Code Section Added: § 58.1-339.2
Coalfield Employment Enhancement Tax Credit - Extended and Amended
House Bill 1454 (Chapter 1034) makes several amendments to the Coalfield Employment Enhancement Tax Credit. It extends the sunset provision of the credit by one year and further extends the provisions that defer the allowance of the credits until after January 1, 1999. The legislation increases the amount of the credit for both surface and underground mining and modifies the seam thickness criteria for determining the credit for underground mining. It also eliminates the General Fund surplus contingency required before the credit may be claimed and reduces the credits earned by a taxpayer if their employment levels decline.
The legislation requires the Tax Commissioner to purchase unused credits at up to 90 percent of the credit amount. The remaining 10 percent is provided for a regional economic development fund administered by the Coalfields Economic Development Authority.
Effective Date: Taxable years beginning on or after January 1, 1996, but before
January 1, 2002
Code Section Amended: § 58.1-439.2
Recycling Tax Credit - Extended
House Bill 297 (Chapter 837) extends by four years the sunset provision of the individual and corporate income tax credits for purchases of machinery and equipment used for processing recyclable materials. The legislation also lengthens the carryover period of the credits from 5 to 10 years.
Effective Date: Taxable years beginning on or after January 1, 1996, but before
January 1, 2001
Code Sections Amended: § 58.1-338 and § 58.1-445.1
Enterprise Zones: Waiver of Employment Eligibility Criteria - New
Senate Bill 553 (Chapter 789) and House Bill 1066 (Chapter 1010) allow the Governor to waive a portion of the employment criteria necessary to qualify for enterprise zone benefits as they apply to pharmaceutical, health care and home care products companies which are undertaking expansions for the primary purpose of basic research or research and development.
The criteria that at least 40% of new employees employed at a qualifying business either have incomes below 80% of the area median income of the jurisdiction prior to employment or are zone residents will be subject to waiver. A waiver, if granted, would apply to a particular business and not to other businesses in the zone.
Effective Date: July 1, 1996
Code Section Amended: § 59.1-279
Individuals
Retirement Plan Contributions Subtraction - New
House Bill 875 (Chapter 624) creates a new Virginia subtraction from federal adjusted gross income for individuals who receive distributions from retirement plans, but only if the individual was taxed on the contributions originally made to the retirement plan by another state. The subtraction applies to qualifying distributions from a qualified pension, profit-sharing, or stock bonus plan as described by § 401 of the Internal Revenue Code, an individual retirement account or annuity established under § 408 of the Internal Revenue Code, a deferred compensation plan as defined by § 457 of the Internal Revenue Code, or a federal government retirement program.
Effective Date: Taxable years beginning on or after January 1, 1996
Code Section Amended: § 58.1-322
Tax Relief for Participants in Operation JOINT ENDEAVOR - New
House Bill 668 (Chapter 401) exempts from individual income tax the pay and allowances earned by military personnel serving in the former Yugoslavia as part of the NATO Peace Keeping Mission designated Operation JOINT ENDEAVOR. This bill also provides income and estimated tax filing relief for these individuals.
Federal legislation grants military personnel serving in Operation JOINT ENDEAVOR the same tax considerations that apply to combat zones. Under Federal law (IRC § 112), enlisted personnel receive a total federal exclusion, while officers receive an exclusion equal to the "maximum enlisted amount." House Bill 668 grants a total exclusion for both enlisted personnel and officers.
Officers who qualify for the federal limited exclusion are entitled to claim a subtraction on their Virginia income tax return for the amount of combat pay that is subject to federal income tax. Enlisted personnel who take the federal total exclusion do not need to make an adjustment on their Virginia income tax return.
For taxable years 1995 and 1996, members of the Armed Forces serving in Operation JOINT ENDEAVOR on the original due date of the Virginia income tax return are granted an extension of time to file and pay the tax due that is equal to the later of: the same individual income tax filing and payment extension they receive for federal purposes plus an additional 15 days, OR a 1-year extension (until May 1, 1997, for 1995 returns).
The department will not require estimated tax declarations and installment payments from these individuals during the period of their filing and payment extension. Penalty and interest will not accrue during the extension period and collection activities will be withheld during the period. The limitation period for administrative and judicial remedies for appealing tax assessments will also be extended.
Effective Date: Taxable years beginning on or after January 1, 1995
Code Sections Amended: §§ 58.1-322, 58.1-344, 58.1-344.1, 58.1-491.1, and 58.1-905
Neighborhood Assistance Act Credit - Deferred
House Bill 1476 (Chapter 694) and Senate Bill 420 (Chapter 936) defer from July 1, 1996, to July 1, 1998, the effective date of the scheduled increase in maximum authorized credits under the Neighborhood Assistance Act. This legislation extends the program two years by authorizing credits through fiscal year 2000. Additionally, Senate Bill 420 authorizes the State Board of Social Services to promulgate Neighborhood Assistance Act regulations. The legislation also defines "impoverished areas."
Effective Date: July 1, 1996
Code Section Amended: § 63.1-323
Open Space Recreation and Conservation Fund Refund Check-off - Extended
House Bill 1212 (Chapter 738) and Senate Bill 606 (Chapter 716) extend the sunset date on the tax refund check-off for the Open Space Recreation and Conservation Fund from January 1, 1996, to January 1, 2001. The check-off was scheduled to expire on December 31, 1995.
Effective Date: Taxable years beginning on or after January 1, 1996, but before January 1, 2001
Code Section Amended: § 58.1-345.1
Political Party Contribution Check-off - Extended Permanently
House Bill 1140 (Chapter 444) eliminates the sunset date of the tax refund check-off for a contribution to a political party. The check-off was scheduled to expire on December 31, 1995. This legislation extends the check-off permanently. A political contribution check-off is provided for any party which meets the definition of a political party under Code of Virginia § 24.2-101 as of July 1 of the previous taxable year.
Effective Date: Taxable years beginning on and after January 1, 1996
Code Section Amended: § 58.1-346
Advanced Technology Pesticide and Fertilizer Application Equipment Credit Expanded
House Bill 1215 (Chapter 739) amends the existing credit allowed for certain agricultural equipment to provide farmers an additional period of time in which to have a nutrient management plan approved by the local Soil and Water Conservation District. This legislation extends the time period for having an approved nutrient management plan to the required tax return filing date. This legislation also adds "starter fertilizer banding attachments for planters" to the list of equipment categories which are eligible for the credit.
Previously, the credit applied to certified equipment purchased by a farmer who had an approved nutrient management plan in place by the end of the tax year in which the purchase was made. If the management plan had not been approved by the end of the tax year, the credit was lost. Many farmers purchase equipment near the end of the year, but prior to approval of a nutrient management plan.
Effective Date: July 1, 1996
Code Sections Amended: § 58.1-337 and § 58.1-436
Agricultural Best Management Practices Tax Credit - New
House Bill 1222 (Chapter 629) creates a new tax credit for "agricultural best management practices" as certified by the local Soil and Water Conservation District Board. The credit is equal to 25 percent of the first $70,000 expended for practices such as animal waste management, soil erosion control, filtration, nutrient management, and pest management. The credit cannot exceed $17,500 or the tax imposed for the year the project was completed. The credit is available for taxable years beginning on and after January 1, 1998.
The soil conservation plan must include "agricultural best management practices" that are approved by the Virginia Soil and Water Conservation Board. Such practices include, but are not limited to: (i) livestock and poultry waste management; (ii) soil erosion control; (iii) nutrient and sediment filtration and detention; (iv) nutrient management; and (v) pest management and pesticide handling.
The credit is nonrefundable, however, the portion of the credit that exceeds the tax liability may be carried forward to the next five taxable years. The credit is based on expenditures made from the taxpayer's own funds.
Effective Date: Taxable years beginning on and after January 1, 1998.
Code Sections Added: § 58.1-339.2 and § 58.1439.4
Signing Estimated Tax Returns - New
House Bill 369 (Chapter 315) eliminates the requirement for individuals, estates, and trusts to sign estimated tax returns. The law had required that estimated tax forms and vouchers be signed. However, the signatures are not used by the department, nor is there a penalty for failure to sign the forms. Current law also provides that a taxpayer who willfully subscribes to an estimated tax return, which he does not believe to be true, shall be guilty of a Class 1 misdemeanor.
Effective Date: July 1, 1996
Code Section Amended: § 58.1-498
Federal Retirees - Period for Filing Claims Extended
House Bill 292 (Chapter 719) allows the Department of Taxation to extend a new settlement offer to federal retirees who were precluded from participating in the original federal retiree settlement program enacted July 1994, and the supplemental settlement program enacted during the 1995 Session. Participation is limited to retirees who notify the department by June 10, 1996, that they are not participating in or have not participated in either of the prior two programs. The first payment under this program is scheduled to be mailed on July 31, 1996, with additional payments each March 31 through 1999.
Effective Date: April 6, 1996
Code Section Amended: None
Employer Withholding
Withholding Allowance Adjustment - Deferred
House Bill 1475 (Chapter 458) and Senate Bill 415 (Chapter 375) defer from January 1, 1997, to January 1, 1999, the effective date allowing taxpayers who itemize their deductions to claim additional withholding allowances. The law change applies only to individuals who itemize their deductions.
Current law allows a taxpayer to claim additional withholding allowances when the withholding tables would produce a substantial refund and authorization has been obtained from the Tax Commissioner. Such requests are routinely granted administratively, and this administrative option remains available to taxpayers.
Effective Date: January 1, 1999
Code Section Amended: §§ 58.1-461, 58.1-462, and 58.1-470
RETAIL SALES & USE TAX
Prescription Medicines and Drugs Exemption - Expanded
House Bill 224 (Chapter 479) expands the current exemption for prescription drugs and medicines to include samples of prescription drugs and medicines and their packaging distributed free of charge to authorized recipients in accordance with the Federal Food, Drug and Cosmetic Act (21 U.S.C.A. §§ 301 et seq., as amended).
Under current law, the exemption applies to the sale of medicines, drugs, hypodermic syringes, artificial eyes, contact lenses, eyeglasses and hearing aids dispensed by or sold on prescriptions or work orders of licensed physicians, dentists, optometrists, ophthalmologists, opticians, audiologists, hearing aid dealers and fitters, nurse practitioners, physicians' assistants, and veterinarians. In addition, controlled drugs purchased for use by a licensed physician in his professional practice are exempt. Hospitals, nursing homes, clinics, and similar corporations not otherwise exempt under this section are excluded from the exemption.
The Federal Food, Drug and Cosmetic Act restricts the sale of samples of controlled drugs and permits pharmaceutical manufacturers to distribute such samples free of charge upon written request by a licensed physician, hospital, or other health care provider. Withdrawls of such samples were subject to the Virginia use tax based on the Virginia Supreme Court's decision in Commonwealth, Dep't of Taxation v. Miller-Morton Co., 220 Va. 852, 263 S.E.2d 413 (1980). This case upheld the assessment of use tax in situations where manufacturers exercised "use" over tangible personal property by withdrawing samples from a tax exempt inventory and distributing them free of charge. This bill will allow pharmaceutical manufacturers to distribute drug samples free of charge, via their salespersons in Virginia, in accordance with the Federal Food, Drug, and Cosmetic Act, without incurring the use tax.
Effective Date: July 1, 1996
Code Section Amended: § 58.1-609.7
Organization Supporting a Medical College - New
Senate Bill 4 (Chapter 356) provides an exemption for tangible personal property purchased by a nonprofit organization which provides support services to a medical college affiliated with a state university. The support services include the professional practices of faculty members associated with such medical college.
Effective Date: July 1, 1996 through June 30, 1998
Code Section Amended: § 58.1-609.7(22)
Various Exemptions - Extended, Expanded, and New
Senate Bill 120 (Chapter 816) deals with four issues:
Dredges
Current law provides an exemption for: (1) ships or vessels used exclusively or principally in interstate or foreign commerce and repairs and alterations to such vessels; (2) fuel and supplies for use or consumption on vessels plying the high seas; and (3) materials used in the building, conversion or repair of any of the vessels in (1) or (2).
This legislation codifies the department's current policy exempting dredges and attendant vessels used directly in the dredging of interstate waterways and would expand the exemption for ships and vessels to include supporting equipment and other attendant vessels used or to be used in dredging operations exclusively or principally in interstate commerce. Specifically, the expanded exemption applies to vessels used to transport employees or equipment to and from the dredge site, vessels used to survey and mark the dredge area, repair parts for such vessels, buoys, fuel to power equipment aboard the dredge and other vessels, rope, chains, and other tangible personal property used in dredging operations exclusively or principally in interstate commerce.
Fuels used in commercial boats or ships for propelling such vessels are exempt from the retail sales and use tax, whether the ships are used in intrastate or interstate commerce. However, fuels used aboard ships and vessels which do not "ply the high seas," either in intercoastal trade between ports in the Commonwealth and ports in other states or in foreign commerce, are subject to the retail sales and use tax. Currently, fuel used aboard dredges and attendant vessels to power equipment is subject to the tax. Such fuels are exempted by this legislation.
Expiring exemptions
The expiration dates of the sales and use tax exemptions grouped in Code of Virginia §§ 58.1609.3 and 58.1-609.4 are extended an additional five years to June 30, 2001.
Annual fund-raising campaigns
Code of Virginia §§ 58.1-609.8(39) and 58.1-609.8(58) had allowed exemptions from the sales and use tax for nonprofit organizations conducting fund-raising campaigns for the direct benefit of its nonprofit member agencies within the Southside and Shenandoah regions of the state. Those statutes are amended to broaden the exemption so that it applies to all nonprofit organizations satisfying the fund-raising requirements of the exemption, regardless of location. Organizations currently exempt from the tax would remain exempt under this legislation. The known organizations qualifying for this exemption are all United Way Chapters in Virginia.
New exemption
This legislation also creates a new educational exemption for an organization established as a consortium of not less than forty private, historically black colleges and universities organized for the purposes of raising funds, providing program services, and offering technical services to support its member colleges and universities and their students. The known organization qualifying for the exemption is the United Negro College Fund.
Effective Dates: The effective date of the expanded shipping vessels exemption is July 1, 1996. The effective dates of the expiring exemptions are July 1, 1996 through June 30, 2001. The effective date of the expanded exemption for purchases by organizations conducting annual fund-raising campaigns is July 1, 1996 through June 30, 1998. The educational exemption is effective July 1, 1996 through June 30, 2001.
Code Sections Amended: §§ 58.1-609.3, 58.1-609.4, and 58.1-609.8.
Nonprescription Drugs Exemption - Deferred
House Bill 1477 (Chapter 459) and Senate Bill 416 (Chapter 376) defer for two years, from July 1, 1996 to July 1, 1998, the effective date of the sales and use tax exemption for nonprescription drugs and proprietary medicines. The exemption was enacted by the 1990 General Assembly, and the effective date was previously deferred by the 1992 and 1994 General Assemblies.
Effective Date: July 1, 1998
Code Section Amended: § 58.1-609.7(15)
Tax Exempt Status of Nonprofit Organizations - New
House Bill 914 (Chapter 499) requires organizations that are exempt from the retail sales and use tax under the educational (§ 58.1-609.4), medical-related (§ 58.1609.7), civic and community service (§ 58.1-609.8) and cultural (§ 58.1-609.9) exemption groupings to maintain an exemption from federal income taxation under § 501(c)(3) or (4) of the Internal Revenue Code as a condition for maintaining tax exempt status for sales and use tax purposes. Organizations must also provide proof that no more than one-third of their gross annual revenue was spent on general administration and fundraising.
The requirement established by this legislation applies to exemption categories or classifications enacted by the General Assembly without regard to an organization's compliance with the information requirements contained in § 30-19.05(B), which became effective July 1, 1994. Organizations qualifying for exemption from the retail sales and use tax under categories enacted prior to 1994 would not be affected by this legislation.
Effective Date: July 1, 1996
Code Section Amended: § 30-19.05
Code Section Amended: § 30-19.05
Baseball Stadium Authority - Expanded
House Bill 1502 (Chapter 1038) and Senate Bill 541 (Chapter 950) allow the Virginia Baseball Stadium Authority (the Authority) to apply sales and use tax revenues generated by transactions taking place at the stadium to: (1) the repayment of bonds issued by the Authority, (2) stadium operating expenses, (3) master lease rental payments, (4) capital expenditures, and (5) other purposes of the Authority. Under current law, the Authority is entitled to sales tax revenues generated by transactions taking place at the stadium but must apply the revenues to repayment of bonds issued to finance or refinance a major league baseball stadium.
The bill also allows the local governing body of the county or city in which the stadium is located to direct, by ordinance or resolution, that all admissions tax revenues generated by admissions to the stadium be remitted to the Authority. The Authority is authorized to apply the revenues to the five purposes outlined above.
Effective Date: July 1, 1996
Code Sections Amended: § 11-45, § 15.1-227.70, §§ 15.1-227.74 through 15.1-227.78, § 15.1-227.84 & § 15.1-227.85
Code Sections Added: §§ 15.1-227.88 & 15.1-227.89
Eliminate Sales and Use Tax Expenditure Study; Introduction of Sales and Use Tax Exemptions - New
Senate Bill 202 (Chapter 606) eliminates the requirement that the Secretary of Finance investigate and analyze the fiscal, economic and policy impact of the retail sales and use tax exemptions and report the findings to the House and Senate Finance Committees each year. This analysis has been published by the Department of Taxation annually as the Virginia Sales and Use Tax Expenditure Stuff. A full cycle of existing exemptions have been analyzed and published.
Senate Bill 202 also requires, effective on or after July 1, 1998, that sales and use tax exemption bills can be introduced in the General Assembly only in regular sessions of even-numbered years. This provision does not apply to any bill extending the expiration date or delaying the effective date of any sales and use tax exemption.
Effective Date: July 1, 1996. The provision for introduced sales and use tax legislation is effective July 1, 1998.
Code Sections Amended: § 30-19.05 and § 30-19.1:3
TAX COLLECTION & ADMINISTRATION
Tax Department Address and Phone Number Included in Instructions - New
House Bill 405 (Chapter 316) requires all department instructions to include, in bold type, the address and telephone number of the department and, if applicable, its e-mail and Internet addresses. The department will revise its instructions to ensure that the address and telephone number is in bold type. The department will provide Internet accounts and addresses as they become available in its forms and instructions.
The department currently prints the applicable name, section, address, and telephone number in the instruction materials for the various taxes that it administers. The addresses and phone numbers of the appropriate local tax officials are also provided in the applicable income tax instruction booklets when returns are required to be filed with those offices.
Effective Date: July 1, 1996
Code Section Amended: § 58.1-214
Electronic Funds Transfer - New
House Bill 1271 (Chapter 449) and Senate Bill 282 (Chapter 370) authorize the Tax Commissioner to accept tax payments by electronic funds transfer (EFT) and clarifies when EFT payments shall be deemed made for purposes of compliance with statutory due dates. Taxpayers will initiate electronic funds transfer of tax payments and the funds will be debited from taxpayers' accounts and credited to the Commonwealth's bank account.
This legislation promotes more efficient collection of taxes by reducing or eliminating the handling of paper returns and checks. Both the Commonwealth and taxpayers should benefit from savings in wages, printing, postage, and storage. Utilization of EFT by taxpayers will reduce the department's dependency on paper documents, reduce taxpayer filing burden, reduce manpower requirements to process tax returns, and expedite payment processing.
Effective Date: July 1, 1996
Code Section Amended: § 58.1-9
Code Section Added: § 58.1-202.1
Public-Private Partnerships - New
Senate Bill 239 (Chapter 643) and House Bill 511 (Chapter 653) authorize the Tax Commissioner to enter into public-private partnerships in order to finance agency technology needs. The compensation for such services would be based on and paid from the increased revenue attributable to the successful implementation of the technology purchased.
An external group of General Assembly appointees, the State Comptroller, and the State Internal Auditor will provide close oversight of the program. The Tax Commissioner is required to prepare an annual report to the Governor and General Assembly on all agreements authorized by these bills which describes each technology program, its progress, revenue impact, and other relevant information.
Effective Date: July 1, 1996
Code Section Added: § 58.1-202.1
Amended Returns: Statute of Limitations for Claiming a Refund - New
Senate Bill 182 (Chapter 637) and House Bill 583 (Chapter 654) extend the statute of limitations for taxpayers to file an amended tax return claiming a refund of state taxes. Under current law, taxpayers may amend a tax return and claim a refund within the later of: (1) three years from the original due date of the return, (2) 90 days from the date of a final determination of a change in federal taxable income, or (3) one year from the filing of an amended return resulting in the payment of additional tax.
These bills provide that the statute of limitations for filing an amended return always extends to at least two years from the date of payment of a tax assessment. The refund amount would be limited to the tax paid within the two-year period, and the issues raised on the amended return must relate to the tax so paid within such two-year period. Taxpayers would not be able to raise new issues on amended returns filed after the original three-year statute of limitations.
Effective Date: Amended returns filed on or after July 1, 1996
Code Section Amended: § 58.1-1823
Setoff Debt Collection Act - Administrative Changes
Senate Bill 168 (Chapter 363) and House Bill 762 (Chapter 413) amend the Setoff Debt Collection Act to allow for more efficient administration by the department. This legislation contains four basic initiatives. It allows the IRS to be a legal participant in the program and repeals requirements for claimant agencies to "certify" the validity of their debts to the department, after a setoff match is made. This legislation allows claimant agencies and the department the flexibility to exchange information electronically instead of in writing. It also repeals the requirement that claimant agencies resubmit their debts to the department each year which allows valid debts to be carried over from one year to the next.
These bills allow the department to reengineer the debt collection program from an essentially manual process into a more automated process.
Effective Date: July 1, 1996
Code Sections Amended: §§ 58.1-520, 58.1-524 through 58.1-528, & 58.1-530
Contract Collectors of Delinquent Tax Accounts - Expanded
House Bill 402 (Chapter 391) and Senate Bill 157 (Chapter 362) enhance the collection of delinquent tax accounts by allowing the Department of Taxation to contract for collection services with private firms. The department will pay for such services from the amounts collected from both in-state and out-of-state delinquent taxpayers.
Effective Date: July 1, 1996
Code Section Amended: § 58.1-1803
LOCAL TAX
LEGISLATION
TANGIBLE PERSONAL PROPERTY TAX
Special Classification for Programmable Computer Equipment - New
House Bill 678 (Chapter 529) expands the local tangible personal property tax classification for computer hardware used by data processing businesses to include programmable computer equipment owned by all businesses. Tangible personal property classified in this category is valued as a percentage of original cost to the taxpayer or actual fair market value.
Effective Date: July 1, 1996
Code Section Amended: § 58.1-3503
Alternative Filing Method for Trailers and Boats - New
House Bill 760 (Chapter 322) allows localities to provide an alternative method of filing personal property tax returns for trailers and boats.
Effective Date: July 1, 1996
Code Section Amended: § 58.1-3518.1
Special Classification for Machinery and Tools Used in Semiconductor Manufacturing or Food Processing - New
House Bill 496 (Chapter 971) creates a separate property tax classification for machinery and tools used in semiconductor manufacturing or food processing. The rate of tax levied on this classification of tangible personal property may be different than the tax rate on other machinery and tools but may never exceed the machinery and tools tax rate.
Effective Date: July 1, 1996
Code Section Added: § 58.1-3508.1
Common Carriers of Property by Motor Vehicle - Clarified
Senate Bill 629 (Chapter 381) excludes a common carrier of property by motor vehicle from the definition of a "certificated motor vehicle carrier" and the tax imposed thereon, and subjects the property to taxation at the local level. This bill was passed in response to federal and state deregulation of the trucking industry.
Effective Date: January 1, 1996
Code Sections Amended: §§ 58.1-2600 & 58.1-2660
Proration of Motor Carrier Property Used in Interstate Commerce - New
Senate Bill 630 (Chapter 536) adds semitrailers to the classification of property that may be prorated. Current law allows localities to prorate the personal property tax on motor vehicles, trailers, and boats based on the number of months in the tax year the property has situs in that locality. This legislation also permits localities to exclude by ordinance certain property of motor carriers of property engaged in interstate commerce from the proration of tangible personal property tax.
The application of prorated property tax to motor carriers' vehicles creates an administrative burden on localities and motor carriers alike because motor carriers continually add and remove vehicles and trailers from their fleets. Localities may now exclude motor vehicles, trailers, and semitrailers with a gross vehicle weight of 10,000 pounds or more from the tax. The property must also be used to transport property for hire by a motor carrier engaged in interstate commerce.
Effective Date: July 1, 1996
Code Section Amended: § 58.1-3516
Definition of Motor Carrier Transportation Property - Clarified
Senate Bill 631 (Chapter 537) clarifies the definition of "motor carrier transportation property" by specifically including trailers and semitrailers with a gross vehicle weight rating of 10,000 pounds or more used to transport property for hire by a motor carrier engaged in interstate commerce. For purposes of local personal property taxation, motor carrier transportation property falls within a special classification which is taxed at a rate not to exceed the machinery and tools tax rate.
Effective Date: July 1, 1996
Code Section Amended: § 58.1-3506
Late Filing of Certifications for Special Classification of Motor Vehicles Owned by Volunteer Rescue Squad and Fire Department Members and Auxiliary Police Officers - New
Senate Bill 186 (Chapter 605) authorizes the commissioner of revenue to accept a late certification for good cause shown and without fault on the part of the taxpayer in order to qualify for a lower tax rate on vehicles owned by members of volunteer rescue squads and fire departments and auxiliary police officers.
Effective Date: July 1, 1996
Code Section Amended: § 58.1-3506
Classification of Property Leased by Volunteer Rescue Squad or Fire Department Members - New
Senate Bill 108 (Chapter 603) amends the special classification of tangible personal property for motor vehicles owned by members of a volunteer rescue squad or volunteer fire department to include leased vehicles. Localities are permitted to impose a lower tax rate on motor vehicles owned and used by members and auxiliary members of volunteer rescue squads and fire departments. This bill would extend this special classification to vehicles leased by these volunteer public safety workers, if the member is obligated by the terms of the lease to pay the tangible personal property tax on the vehicle.
Effective Date: July 1, 1996
Code Section Amended: § 58.1-3506
Manufacturing Office Equipment as Capital - Codifies Existing Policy
House Bill 741 (Chapter 622) provides that certain tangible personal property used in the headquarters of a manufacturing business be classified as intangible personal property. This bill codifies the City of Winchester v. American Woodmark Corporation 250 Va. 451: 464 S.E.2d 148: (1995) court decision. The court ruled that furniture, fixtures, office equipment, and computer equipment used in a manufacturer's headquarters should be classified as intangible personal property, thus making it exempt from local personal property taxes.
Effective Date: July 1, 1996
Code Section Amended: § 58.1-1101
REAL ESTATE TAX
Taxation of Leasehold Interests in Exempt Property by Churches - New
House Bill 217 (Chapter 478) permits organizations exempt from federal income tax to lease property from a church for charitable, literary, scientific, or educational purposes without becoming subject to property tax on their leasehold interest in the property.
Effective Date: July 1, 1996
Code Section Amended: § 58.1-3203
Application for Exemption by Elderly and Handicapped Persons - New
House Bill 275 (Chapter 480) allows taxpayers applying for a property tax exemption for the elderly or handicapped to furnish a written statement in lieu of an affidavit. By eliminating the requirement that a notarized affidavit be filed annually, localities can reduce the filing burden placed on elderly and handicapped taxpayers seeking this exemption.
Effective Date: July 1, 1996
Code Section Amended: § 58.1-3213
Credits on Rehabilitated Residential Property - New
House Bill 892 (Chapter 765) allows localities to grant credits to purchasers of property that would be otherwise eligible for the partial exemption for substantially rehabilitated residential real property. Credits will be allowed only when, at the time of purchase, the property is subject to liens for property taxes exceeding fifty percent of the assessed value of the property. The credit may be divided over a period not to exceed 10 years, and the governing body may assess an application fee not to exceed $50.
Effective Date: July 1, 1996
Code Section Added: § 58.1-3220.01
BPOL
Uniform Ordinance - New
The provisions of Senate Bill 587 (Chapter 715) and House Bill 293 (Chapter 720) are summarized below:
Due dates, penalties, and interest
The bills require a uniform March 1 due date for BPOL tax returns effective for license year 2001. The delayed effective date accommodates localities that must make substantial changes to their automated systems to handle a return and tax payment due on the same day.
The bills clarify that only one penalty (up to 10%) will be imposed when both the return and payment are late, unless there is a history of noncompliance. Some localities currently levy separate penalties for failure to file and failure to pay.
The bills grant local officials more latitude to waive penalties. It provides that penalties shall be waived if the failure to file or pay was not the fault of the taxpayer a definition of fault, or lack of fault, is included.
The bills basically conform rules for interest on local taxes with state provisions interest must be charged on all late payments and paid on all refunds, regardless of the reason for the late payment or the refund. Interest on refunds must be paid at the same rate charged on late payments but no interest will be charged or paid on adjustments of estimated tax to actual tax at the end of a license year, or if the payment is made within 30 days of the due date.
Situs of gross receipts
The bills provide that gross receipts are taxable only if a definite place of business is located in a locality (with certain statutory exceptions), and then only if the gross receipts are attributable to the definite place of business under specific rules. The definition of "definite place of business" requires occupancy for 30 days or more.
The bills make clear that the only receipts that a locality may tax are those derived from a definite place of business within the locality. This will eliminate so-called "throwback" rules, where a locality might seek to tax receipts attributable to other jurisdictions simply because those jurisdictions did not levy a gross receipts tax.
Apportionment of gross receipts
The bills address situations where gross receipts are attributable to two or more definite places of business. The receipts will be apportioned between the definite places of business on the basis of payroll. Localities are encouraged to enter into agreements with each other to ensure that taxpayers are not subject to double taxation on gross receipts. If the parties cannot agree, they may request the Department of Taxation to issue an opinion.
A new exemption is also provided for receipts attributable to activity in another state in which the taxpayer is subject to income tax. This provision is modeled on one recently adopted by Fairfax County. This exemption addresses situations where a taxpayer may be subject to income tax in a state even though there is no definite place of business in that state or where gross receipts are generated by a Virginia sales office, but the actual revenue-generating activity is performed in another state and managed by an out-of-state office of the company.
Exclusions from gross receipts
The bills contain an exemption for receipts not received in the ordinary course of the licensed business, profession, or occupation. Examples of such receipts include investment income (unless the taxpayer is in the business of investing), interest on bank accounts, returns of principal, and customer returns and allowances.
Limitations and extensions
The taxpayer and local tax official may agree to extend the period for assessing additional tax. This will give the parties adequate time to resolve issues and avoid the necessity for a local tax official to issue an assessment based on incomplete information, which must subsequently be corrected. Additional tax may be assessed within six years in cases of fraud or failure to obtain a license. The period for appealing an assessment and collecting an assessment are both extended by an agreement extending the period for assessing tax and by an appeal which suspends collection action.
Appeals and rulings
Specific procedures are provided for taxpayers to appeal a disputed audit assessment to the local tax official. Collection activity must be suspended while an appeal is pending but interest will accrue on all or part of the assessment that is upheld. The taxpayer may further appeal the local tax official's determination to the Tax Commissioner. Either party may contest the Tax Commissioner's determination in circuit court, but the Tax Commissioner shall not be a party to the litigation. The Tax Commissioner's authority to issue rulings is broadened to cover any BPOL issue, instead of the current limitation to classification issues.
Nonprofit organizations
The bills contain a new exemption for nonprofit organizations. Traditional charities are exempt unless they have unrelated business taxable income under federal law. Other nonprofit organizations are exempt as to their membership dues and gifts received, but not on gross receipts from a business activity similar to other licensable businesses.
Venture capital exemption
A new exemption was created for venture capital and investment funds to prevent the BPOL tax from discouraging investment firms from locating in Virginia and providing capital to small and new businesses.
Thresholds
BPOL tax may be imposed by localities if annual gross receipts exceed the threshold amounts for the population ranges indicated in the table below.
Threshold Amount Population
No threshold Below 25,000
$50,000 Between 25,000 and 50,000
$100,000 Over 50,000
The $30 minimum tax is repealed and the new thresholds will exempt many small businesses from the tax.
Fees
A license fee may be charged to all businesses, including those with gross receipts less than the threshold, as follows:
Maximum Fee Population
$30 Below 25,000
$50 Between 25,000 and 50,000
$100 ($50 by Jan. 1, 2000) Over 50,000
Effective Date: Generally, January 1, 1997, but selected provisions have other effective dates or transition rules
Code Sections Amended: §§ 58.1-3700, 58.1-3701, 58.1-3703, 58.1-3706, 58.1-3708, & 58.1-3732
Code Sections Added: §§ 58.1-3700.1 & 58.1-3703.1
Code Sections Repealed: §§ 58.1-3707 & 58.1-3725
MISCELLANEOUS TAXES
Coal and Gas Road Improvement Tax
Allocation of Revenue for Water Projects
Senate Bill 347 (Chapter 706) allows localities in the Virginia Coalfield Development Authority to increase the amount of revenue from the coal and gas road improvement tax allocated to water projects. Localities would be required to develop and ratify an annual funding plan for such projects. The amount of revenue that may be allocated to water projects was increased from one-fourth to one-half of the funds deposited into the Coal and Gas Road Improvement Fund.
Effective Date: July 1, 1996
Code Section Amended: § 58.1-3713
Code Section Added: § 58.1-3713.01
Transient Occupancy Tax
Arlington County Sunset Date - Extended
House Bill 68 (Chapter 477) extends the sunset date, from December 31, 1996 to December 31, 1999, on the additional one-fourth of one percent transient occupancy tax imposed by Arlington County. The revenues collected from this additional tax will be used to promote tourism and business travel in Arlington County.
Effective Date: Through December 31, 1999
Code Section Amended: § 58.1-3822
Chesterfield, Hanover, and Henrico Allowed to Impose Additional Tax - New
Senate Bill 556 (Chapter 712) allows the counties of Chesterfield, Hanover and Henrico to impose an additional transient occupancy tax at a rate not to exceed 4 percent of the amount of the charge for the occupancy of any room or space occupied. The revenues collected from this additional tax will be used to promote tourism and travel in the Richmond metropolitan area.
Effective Date: July 1, 1996
Code Section Added: § 58.1-3823
Arlington, Loudoun, Nelson, Spotsylvania, and York Allowed to Impose Maximum 5% Tax - New
Senate Bill 594 (Chapter 833) allows the counties of Arlington, Loudoun, Nelson, Spotsylvania and York to impose a transient occupancy tax at a maximum rate of 5 percent. The revenues collected from that portion of the tax exceeding 2 percent will be used to promote tourism and travel in these localities.
Effective Date: July 1, 1996
Code Section Amended: § 58.1-3819
Admissions Tax
Baseball Stadium Authority - Expanded
House Bill 1502 (Chapter 1038) and Senate Bill 541 (Chapter 950) allow the local governing body of the county or city in which the stadium is located to direct, by ordinance or resolution, that all admissions tax revenues generated by admissions to the stadium be remitted to the Virginia Baseball Stadium Authority (the Authority). The Authority is authorized to apply the revenues to the following purposes: (1) the repayment of bonds issued by the Authority, (2) stadium operating expenses, (3) master lease rental payments, (4) capital expenditures, and (5) other purposes of the Authority.
Effective Date: July 1, 1996
Code Sections Amended: § 11-45, § 15.1-227.70, §§ 15.1-227.74 through 15.1-227.78, § 15.1-227.84 & § 15.1-227.85
Code Sections Added: §§ 15.1-227.88 & 15.1-227.89
TAX EXEMPT PROPERTY
Local Technology Zones: Cities, Counties, and Towns - Expanded
Senate Bill 584 (Chapter 830) allows all cities, counties, or towns to establish, by ordinance, technology zones and removes the one zone limit currently in effect. This legislation expands the ability of localities to offer tax incentives and regulatory flexibility to business prospects interested in moving to a particular locality. A technology zone consists of up to 125 acres where a locality may grant tax incentives and provide regulatory flexibility. Tax incentives may be provided for up to ten years and may include reductions in user fees, permit fees, and any type of gross receipts tax.
Effective Date: July 1, 1996
Code Section Amended: § 58.1-3850
Property Leased for Charitable Purposes - New
Senate Bill 124 (Chapter 534) provides that rent applied to reduce the principal of a note or bond held by a political subdivision will not be considered profit if the lessee is exempt under I.R.C. § 501 (c)(3) and the property is used for charitable purposes.
Effective Date: July 1, 1996
Code Section Amended: § 58.1-3603
TAX COLLECTION AND ADMINISTRATION
Local Tax Levies: Time Limitations on Changes in Tax Rates - New
House Bill 782 (Chapter 354) requires that any change to tax levies must be made prior to the date in which the personal property and land books are delivered to the local treasurer. Code of Virginia § 58.1-3311 prohibits the alteration of personal property and land books after they are delivered to the local treasurer. This legislation will ensure compliance with the law by preventing tax rate changes which would require the alteration of the books made after their delivery.
Effective Date: July 1, 1996
Code Section Amended: § 58.1-3012
Priority of Liens - Clarified
House Bill 671 (Chapter 732) ensures that liens for local property taxes specifically assessed against goods and chattels take priority over all other liens. The bill defines "specifically assessed in bulk" to mean an assessment against the specific class of property held for tax enforcement purposes.
Effective Date: July 1, 1996
Code Section Amended: § 58.1-3942
Third Party Agreements for Payment of Local Taxes - New
House Bill 772 (Chapter 896) enables local treasurers to enter into agreements with third parties whereby payment of a taxpayer's outstanding tax bill would be assumed by a third party. The third party would be entitled to charge the taxpayer interest and fees and would be entitled to a refund from the locality for any funds, exclusive of interest and fees, not received by the third party if the taxpayer fails to meet his obligation under the terms of the agreement.
Effective Date: July 1, 1996
Code Section Added: § 58.1-3018
Powers and Duties of Treasurers and Commissioners of Revenue - Expanded
House Bill 773 (Chapter 323) allows commissioners of revenue greater latitude in their office operations and in the collection of real estate taxes. The bill clarifies various exemptions that do not apply to the collection of taxes when a treasurer is attempting to collect by distress or lien.
Effective Date: July 1, 1996
Code Sections Amended: §§ 34-3, 58.1-3112, 58.1-3129, 58.1-3912, 58.1-3919, 58.1-3940, 58.1-3941 & 58.1-3965
Receipts for Payments Made in Cash or by Money Order - New
House Bill 888 (Chapter 324) permits treasurers to deliver a receipt for payment of taxes by cash or money order only when requested by the taxpayer. Previously, the law required that a receipt be provided for all payments made by cash or money order.
Effective Date: July 1, 1996
Code Section Amended: § 58.1-3914
Willful Failure to Collect and Account for Daily Rental Property Tax - New
House Bill 422 (Chapter 528) makes it a Class 1 misdemeanor for a corporate or partnership officer or other person to willfully fail to collect or truthfully account for and pay over the local daily rental property tax administered by the Commissioner of the Revenue or other authorized officer. As provided in Code of Virginia § 18.2-11, a Class 1 misdemeanor is punishable by confinement in jail for not more than twelve months and a fine of not more than $2,500, either or both.
The daily rental property tax may be imposed by any locality, and the tax may not exceed one percent on the gross proceeds of any person engaged in the short-term rental business. The tax is collected from the lessee of the daily rental property at the time of the rental and held in "trust" for the local government.
The penalty prescribed by this legislation is the same as the penalty for failure to collect or truthfully account for state trust taxes (sales and withholding) and other local trust taxes (local admission, transient occupancy, food and beverage, and cigarette taxes).
House Bill 422 also authorizes either the attorney for the Commonwealth or other attorney charged with the responsibility for the prosecution to criminally prosecute a corporate or partnership officer or other person for a Class 1 misdemeanor. This action takes place when such person willfully fails to collect or truthfully account for and pay over local trust taxes.
Effective Date: July 1, 1996
Code Section Amended: § 58.1-3907
LEGISLATIVE
STUDIES
LEGISLATIVE STUDIES
The following is a list of 1996 tax-related legislative studies.
C HJR 108: The Commission on State and Local Government Responsibility and Taxing Authority has been continued for one year. The Commission determined that further study is needed in order to complete its task of examining state and local services and revenues raised to provide those services and to determine if changes are needed. TAX and other agencies will continue to provide technical assistance to the Commission.
C SJR 24: The Department of Motor Vehicles will examine the registration, inspection, and taxation of motor carriers. T he study will evaluate (1) the feasibility and fiscal impact of offering permanent registration for trailers of motor carriers for a fee that is competitive with the fees of states offering permanent trailer plates, (2) the fiscal impact of exempting heavy duty vehicles of motor carriers from the motor vehicle sales and use tax or establishing a competitive cap on the amount of the tax imposed on such vehicles, and (3) the advisability of allowing valid federal annual inspections of commercial vehicles subject to federal motor carrier safety regulations to be accepted in lieu of the state inspection. The advisability of instituting a centrally-administered system for the collection of ad valorem taxes on the equipment of motor carriers will also be studied, with assistance from the Virginia Trucking Association and Commissioners of the Revenue. TAX will provide technical assistance in this study.
C SR 17: The Revenue Resources Subcommittee of the Senate Finance Committee will study the advisability of reducing or eliminating the local tangible personal property tax in Virginia. They will examine the fairness of the current tax system as well as the advantages and disadvantages of using alternate sources of revenue to offset any reduction or elimination of the tangible personal property tax. TAX will provide technical assistance in this study.
INDEX -- BY BILL NUMBER
BILL NO. CHAPTER SUBJECT MATTER PAGE
HB 68 477 Transient Occupancy Tax: Arlington County . . . . . . . . . . ......... . . 27
HB 217 478 Taxation of Leasehold Interests in Exempt Church Property. ...... 23
HB 224 479 Sales and Use Tax: Drug Samples . . . . . . . . . . . . . . . . . . . . 12
HB 275 480 Real Estate Tax: Elderly/Handicapped Exemption . . . . . . . . 23
HB 292 719 Federal Retiree Settlement Act - Extended . . . . . . . . . . . . . ....... 10
HB 293 720 BPOL: Uniform Ordinance . . . . . . . . . . . . . . . . . . . . . . . . . ......... . 24
HB 297 837 Income Tax: Recycling Equipment Credit . . . . . . . . . . ....... . . . . 7
HB 305 874 Income Tax: Major Business Facility Job Tax Credit . ..... . . . . . 5
HB 369 315 Income Tax: Signing Estimated Tax Returns . . . . . . ..... . . .. . . . 10
HB 402 391 TAX Administration: Contract Collectors . . . . . . . . ..... . . . . . . . 18
HB 405 316 TAX Administration: Addresses and Phone Numbers Required
on Forms and Instructions . . . . . . . . . . . . . . . . ........ . . . . . . . . . 16
HB 422 528 Local Daily Rental Property Tax: Willful Failure to File . ..... . . . 31
HB 423 793 Tax Information Disclosure by Commissioners of Revenue ... . . 2
HB 496 971 Personal Property Tax: Semiconductor Manufacturers
and Food Processors . . . . . . . . . . . . . . . . . . . . . . . . ....... . . . . 20
HB 511 653 TAX Administration: Public-Private Partnerships . . . . . . .... . . . 16
HB 583 654 TAX Administration: Amended Returns/Statute of Limitations ... 17
HB 588 655 Penalty Waivers, Filing Extensions, and Filing Frequencies .... . 3
HB 668 401 Tax Relief for Participants in OPERATION JOINT ENDEAVOR .. 8
HB 671 732 Local Tax Enforcement: Priority of Liens . . . . . . . . . . . . . . . ...... . 30
HB 678 529 Tangible Personal Property: Classification of Programmable
Computer Equipment . . . . . . . . . . . . . . . . . . . . . . . . . . . ........ . . . . 20
HB 720 497 Income Tax: Daycare Facility Investment Tax Credit . . . . . ...... . . 5
HB 733 988 Tax Information Disclosure by Commissioners of Revenue . .... . 2
HB 741 622 Tangible Personal Property: Manufacturers' Office Equipment ... 22
HB 760 322 Tangible Personal Property: Alternative Filing Methods . . . .... . 20
HB 762 413 TAX Administration: Debt Setoff Act . . . . . . . . . . . . . . . . ...... . . . 17
HB 766 657 General Provisions: Electronic Filing . . . . . . . . . . . . . . ........ . . . . . 3
HB 772 896 Local: Third Party Tax Payment Agreements . . . . . . . . ...... . . . . . 30
HB 773 323 Powers and Duties of Treasurers and Commissioners
of Revenue . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . ........... . . 30
HB 782 354 Local: Time Limitation on Changes in Local Tax Rates . . . . ..... . 30
HB 875 624 Income Tax: Retirement Plan Contributions Deduction . . . . ...... . 7
HB 888 324 Local: Tax Payment Receipts . . . . . . . . . . . . . . . . . . . . . . . . ........ . 31
HB 892 765 Real Property Tax Credit for Rehabilitated Residential Property ...23
HB 914 499 Sales and Use Tax: Tax Exempt Status of Nonprofit
Organizations . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .............. . . . . 14
HB 1066 1010 Income Tax: Enterprise Zones . . . . . . . . . . . . . . . . . . . . . . .. . . 7
HB 1140 444 Income Tax: Political Contribution Refund Checkoffs . . . .. . . 9
HB 1212 738 Income Tax: Open Space Recreation and Conservation
Refund Checkoff . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . ................ . 9
HB 1215 739 Income Tax: Pesticide/Fertilizer Equipment Tax Credit . . . . ......... . . . 9
INDEX -- BY BILL NUMBER
BILL NO. CHAPTER SUBJECT MATTER PAGE
HB 1222 629 Income Tax: Best Agricultural Management Practices
Tax Credit . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . ...... 10
HB 1271 449 TAX Administration: Payments by Electronic Funds Transfer. 16
HB 1451 634 TAX Administration: Taxpayer Bill of Rights . . . . . . . . . . . . ... . 3
HB 1453 520 Income Tax: Historic Rehabilitation Tax Credit . . . . . . . .... . . . . 6
HB 1454 1034 Income Tax: Coalfield Employment Tax Credit . . . . . . . ... . .. . . 6
HB 1474 580 Income Tax: Defers Low-income Housing Tax Credit . . . ... . . . 5
HB 1475 458 Income Tax: Defers Withholding Allowance Adjustment . . . .... . 11
HB 1476 694 Income Tax: Defers Expiration of Neighborhood Assistance
Act Credit . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . ............ . . . . . 8
HB 1477 459 Sales and Use Tax: Defers Nonprescription Drugs Exemption ...14
HB 1502 1038 Sales and Use Tax: Virginia Baseball Stadium Authority . . ..... . 15
HB 1502 1038 Local Admissions Tax: Virginia Baseball Stadium Authority . .... 28
HB 1503 521 Income Tax: Credit for Rent Reductions . . . . . . . . . . . . ........ . . . . 6
HJR 108 - Commission on State and Local Government Responsibility
and Taxing Authority . . . . . . . . . . . ........... . . . . . . . . . . . . . . . . . . . . 33
SB 4 356 Sales and Use Tax: Exemption for Organization Supporting
a Medical College . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . ........... . 12
SB 108 603 Personal Property Tax: Exemption for Vehicles Leased by
Volunteer Rescue Squad and Fire Department Members . ...... . 21
SB 120 816 Sales and Use Tax: Various Exemptions Extended . . . . . ....... . . 13
SB 124 534 Personal Property Tax: Property Leased for Charitable
Purposes . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . ............. . . . . 29
SB 157 362 TAX Administration: Contract Collectors . . . . ...................... . . . . . . . . . . . 18
SB 166 635 General Provisions: Electronic Filing . . . . . . . . . . . . . . ....................... . . . 3
SB 168 363 TAX Administration: Debt Setoff Act . . . . . . . . . . . . . . . . ....................... . . 17
SB 182 637 TAX Administration: Amended Returns/Statute of Limitations ..................17
SB 186 605 Personal Property Tax: Late Filing of Certifications by
Volunteer Rescue Squad and Fire Department Members
and Auxiliary Police Officers . . . . . . . . . . . . . . . . . . . . ......................... . . . . 21
SB 202 606 Sales and Use Tax: Eliminates Expenditure Study . . ...................... . . . . . 15
SB 210 640 Penalty Waivers, Filing Extensions, and Filing Frequencies ....................... 3
SB 218 784 Tax Information Disclosure by Commissioners of Revenue . ....................... 2
SB 239 643 TAX Administration: Public-private partnerships . . . . . . . . ........................ . 16
SB 282 370 TAX Administration: Payments by Electronic Funds Transfer ...................... 16
SB 347 706 Local: Allocation of Coal and Gas Road Improvement Tax ........................ . 27
SB 415 375 Income Tax: Defers Withholding Allowance Adjustment . . ......................... . 11
SB 416 376 Sales and Use Tax: Defers Nonprescription Drugs Exemption .....................14
SB 420 936 Income Tax: Defers Expiration of Neighborhood Assistance
Act Credit . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . ............................... . . 8
SB 421 826 Income Tax: Defers Low-Income Housing Tax Credit . . . . ........................... . . 5
SB 541 950 Sales and Use Tax: Virginia Baseball Stadium Authority . . ......................... . 15
SB 541 950 Local Admissions Tax: Virginia Baseball Stadium Authority . ........................ 28
INDEX -- BY BILL NUMBER
BILL No. CHAPTER SUBJECT MATTER PAGE
SB 553 789 Income Tax: Enterprise Zones . . . . . . . . . . . . . . . . . . . .................. . . . 7
SB 556 712 Transient Occupancy Tax: Counties of Chesterfield,
Hanover, and Henrico . . . . . . . . . . . . . . . . . . . . . . . . . . . . ...................... 27
SB 569 614 Disclosure of Probate Tax Return Information . . . . . . . . . . ................ 2
SB 584 830 Local: Technology Zones for Cities, Counties, and Towns ................. 29
SB 587 715 BPOL: Uniform Ordinance . . . . . . . . . . . . . . . . . . . . . . . .................. . . 24
SB 594 833 Transient Occupancy Tax: Counties of Arlington, Loudoun,
Nelson, Spotsylvania, and York . . . . . . . . . . . . . . . . . . . .................. . . 28
SB 606 716 Income Tax: Open Space Recreation and Conservation
Refund Check-off . . . . . . . . . . . . . . . . . . . . . .................... . . . . . . . . . . . 9
SB 629 381 Personal Property Tax: Common Carriers of Property
by Motor Vehicle . . . . . . . . . . . . . . . . . . . . . . . . . ................... . . . . . . . . 20
SB 630 536 Personal Property Tax: Proration of Motor Carrier Property
Used in Interstate Commerce . . . . . . . . . ................. . . . . . . . . . . . . . . 21
SB 631 537 Personal Property Tax: Clarifies Definition of Motor
Carrier Transportation Property . . . . . . . . . . . . . . . ................. . . . . . . . 21
SJR 24 - Motor Carrier Study . . . . . . . . . . . . . . . . . . . . . . . . . . . ................... . . . . 33
SR 17 - Local Tangible Personal Property Tax Study . . . . . . . . . ................ . . . 33
INDEX -- BY CODE SECTION
VA. CODE § BILL NO. SUBJECT MATTER PAGE
11-45 SB 541 Sales and Use/Admissions Tax: Virginia
Baseball Stadium Authority . . . . . . . . . . . . . . . . . . . . . . . . 15, 28
11-45 HB 1502 Sales and Use/Admissions Tax: Virginia
Baseball Stadium Authority . . . . . . . . . . . . . . . . . . . . . . . . 15, 28
15.1-227.70 SB 541 Sales and Use/Admissions Tax: Virginia
Baseball Stadium Authority . . . . . . . . . . . . . . . . . . . . . . . . 15, 28
15.1-227.70 HB 1502 Sales and Use/Admissions Tax: Virginia
Baseball Stadium Authority . . . . . . . . . . . . . . . . . . . . . . . . 15, 28
15.1-227.74 -
15.1-227.78 SB 541 Sales and Use/Admissions Tax: Virginia
Baseball Stadium Authority . . . . . . . . . . . . . . . . . . . . . . . . 15, 28
15.1-227.74 -
15.1-227.78 HB 1502 Sales and Use/Admissions Tax: Virginia
Baseball Stadium Authority . . . . . . . . . . . . . . . . . . . . . . . . 15, 28
15.1-227.84 SB 541 Sales and Use/Admissions Tax: Virginia
Baseball Stadium Authority . . . . . . . . . . . . . . . . . . . . . . . . 15, 28
15.1-227.84 HB 1502 Sales and Use/Admissions Tax: Virginia
Baseball Stadium Authority . . . . . . . . . . . . . . . . . . . . . . . . 15, 28
15.1-227.85 SB 541 Sales and Use/Admissions Tax: Virginia
Baseball Stadium Authority . . . . . . . . . . . . . . . . . . . . . . . . 15, 28
15.1-227.85 HB 1502 Sales and Use/Admissions Tax: Virginia
Baseball Stadium Authority . . . . . . . . . . . . . . . . . . . . . . . . 15, 28
15.1-227.88 SB 541 Sales and Use/Admissions Tax: Virginia
Baseball Stadium Authority . . . . . . . . . . . . . . . . . . . . . . . . . 15, 28
15.1-227.88 HB 1502 Sales and Use/Admissions Tax: Virginia
Baseball Stadium Authority . . . . . . . . . . . . . . . . . . . . . . . . . 15, 28
15.1-227.89 SB 541 Sales and Use/Admissions Tax: Virginia
Baseball Stadium Authority . . . . . . . . . . . . . . . . . . . . . . . . . 15, 28
15.1-227.89 HB 1502 Sales and Use/Admissions Tax: Virginia
Baseball Stadium Authority . . . . . . . . . . . . . . . . . . . . . . . . . 15, 28
30-19.05 HB 914 Sales and Use Tax: Tax Exempt Status of
Nonprofit Organizations . . . . . . . . . . . . . . . . . . . . . . . ......... . .. 14
30-19.05 SB 202 Sales and Use Tax: Eliminates Expenditure Study . . . . . . . 15
30-19.1:3 SB 202 Sales and Use Tax: Eliminates Expenditure Study . . . . . . . 15
34-3 HB 773 Powers and Duties of Treasurers and Commissioners
of Revenue . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . ....... . . . . . . 30
36-55.63 SB 421 Income Tax: Defers Low-Income Housing Tax Credit . . . . . . 5
36-55.63 HB 1474 Income Tax: Defers Low-Income Housing Tax Credit . . . . . . 5
58.1-3 SB 569 Disclosure of Probate Tax Return Information . . . . . . . . .. . . . 2
58.1-3 SB 218 Tax Information Disclosure by Commissioners
of Revenue to TAX . . . . . . ..... . . . . . . . . . . . . . . . . . . . . . . . . . . 2
58.1-3 HB 423 Tax Information Disclosure by Commissioners
of Revenue to TAX . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .... . . 2
INDEX -- BY CODE SECTION
VA. CODE § BILL NO. SUBJECT MATTER PAGE
58.1-3 HB 733 Tax Information Disclosure by Commissioners of
Revenue to Department of Professional and
Occupational Regulation . . . . . . . . . . . . . . . . . . . . . . .. . . . . 2
58.1-9 SB 166 General Provisions: Electronic Filing . . . . . . . . . . . . . . . . . 3
58.1-9 HB 766 General Provisions: Electronic Filing . . . . . . . . . . . . . . . . . 3
58.1-9 SB 282 TAX Administration: Payments by Electronic
Funds Transfer . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .... . . . . 16
58.1-9 HB 1271 TAX Administration: Payments by Electronic
Funds Transfer . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .... . . . . 16
58.1-105 SB 210 TAX Administration: Penalty Waivers, Filing
Extensions, and Filing Frequencies . . . . . . . . . . . . . . . . . . . 3
58.1-105 HB 588 TAX Administration: Penalty Waivers, Filing
Extensions, and Filing Frequencies . . . . . . . . . . . . . . . . . . . 3
58.1-112 SB 210 TAX Administration: Penalty Waivers, Filing
Extensions, and Filing Frequencies . . . . . . . . . . . . . . . . . . . 3
58.1-112 HB 588 TAX Administration: Penalty Waivers, Filing
Extensions, and Filing Frequencies . . . . . . . . . . . . . . . ... . . 3
58.1-202 HB 1451 TAX Administration: Taxpayer Bill of Rights . . . . . . ... . . . ... 3
58.1-202.1 SB 282 TAX Administration: Payments by Electronic
Funds Transfer . . . . . . . . . . . . . . . . . . . . . . . . . . . . ..... . . ... . . 16
58.1-202.1 HB 1271 TAX Administration: Payments by Electronic
Funds Transfer . . . . . . . . . . . . . . . . . . . . . . ..... . . . . . . . . . . . . 16
58.1-202.1 SB 239 TAX Administration: Public-Private Partnerships . . . . . . . 16
58.1-202.1 HB 511 TAX Administration: Public-Private Partnerships . . . . . . . 16
58.1-214 HB 405 TAX Administration: Addresses and Phone
Numbers Required on Forms and Instructions . . . . . . .... . . . 16
58.1-307 HB 1451 TAX Administration: Taxpayer Bill of Rights . . . . . . . . . . . .... 3
58.1-313 HB 1451 TAX Administration: Taxpayer Bill of Rights . . . . . . . . . .... . . 3
58.1-322 HB 875 Income Tax: Retirement Plan Contributions Deduction . .... . . 7
58.1-322 HB 668 Income Tax: Tax Relief for Participants in
OPERATION JOINT ENDEAVOR . . . . . . . . . . . . . . . . . ..... . . 8
58.1-336 SB 421 Income Tax: Defers Low-Income Housing Tax Credit . . . . 5
58.1-336 HB 1474 Income Tax: Defers Low-Income Housing Tax Credit . . . . 5
58.1-337 HB 1215 Income Tax: Pesticide/Fertilizer Equipment Tax Credit . . . 9
58.1-339 HB 1503 Income Tax: Credit for Rent Reductions . . . . . . . . . . . ..... . . 6
58.1-339.2 HB 1453 Income Tax: Historic Rehabilitation Tax Credit . . . . . . ... . . 6
58.1-339.2 HB 1222 Income Tax: Best Agricultural Management
Practices Tax Credit . . . . . . . . . . . . . . . . . . . . . . . . . ...... . . . . . 10
58.1-344 HB 668 Income Tax: Tax Relief for Participants in
OPERATION JOINT ENDEAVOR . . . . . . . . . . . . . . . . ......... . 8
58.1-344.1 HB 668 Income Tax: Tax Relief for Participants in
OPERATION JOINT ENDEAVOR . . . . . . ........ . . . . . . . . . . . . 8
INDEX -- BY CODE SECTION
VA. CODE § BILL No. SUBJECT MATTER PAGE
58.1-345.1 SB 606 Income Tax: Open Space Recreation and
Conservation Refund Check-off . . . . . . . . . . . . . . . . . . . . . 9
58.1-345.1 HB 1212 Income Tax: Open Space Recreation and
Conservation Refund Checkoff . . . . . . . . . . . . . . . . . . . ........ . . 9
58.1-346 HB 1140 Income Tax: Political Contribution Refund Checkoffs . . .. . 9
58.1-435 SB 421 Income Tax: Defers Low-Income Housing Tax Credit . .... . 5
58.1-435 HB 1474 Income Tax: Defers Low-income Housing Tax Credit . . .. . 5
58.1-436 HB 1215 Income Tax: Pesticide/Fertilizer Equipment Tax Credit . ... . 9
58.1-439 HB 305 Income Tax: Major Business Facility Job Tax Credit . . . . .... 5
58.1-439.2 HB 1454 Income Tax: Coalfield Employment Tax Credit . . . . . . . ..... . 6
58.1-439.4 HB 720 Income Tax: Daycare Facility Investment Tax Credit . . ..... . 5
58.1-439.4 HB 1222 Income Tax: Best Agricultural Management
Practices Tax Credit . . . . . . . . . . . . . . . . . . . . . . . . . . . ......... . 10
58.1-445.1 HB 297 Income Tax: Recycling Equipment Credit . . . . . . . . . . ........ . . 7
58.1-461 SB 415 Income Tax: Defers Withholding Allowance
Adjustment . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . ............ . 11
58.1-461 HB 1475 Income Tax: Defers Withholding Allowance
Adjustment . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . ............ . . 11
58.1-462 SB 415 Income Tax: Defers Withholding Allowance
Adjustment . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . ............ . 11
58.1-462 HB 1475 Income Tax: Defers Withholding Allowance
Adjustment . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . ............ . 11
58.1-470 SB 415 Income Tax: Defers Withholding Allowance
Adjustment . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . ............. . . 11
58.1-470 HB 1475 Income Tax: Defers Withholding Allowance
Adjustment . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . ............. . 11
58.1-491.1 HB 668 Income Tax: Tax Relief for Participants in
OPERATION JOINT ENDEAVOR . . . . . . . . . . . . . . . .......... . . . 8
58.1-498 HB 369 Income Tax: Signing Estimated Tax Returns . . . . . .......... . . . . . 10
58.1-520 SB 168 TAX Administration: Debt Setoff Act . . . . . . . . . . . . . . .......... 17
58.1-520 HB 762 TAX Administration: Debt Setoff Act . . . .......... . . . . . . . . . . . 17
58.1-524 -
58.1-528 SB 168 TAX Administration: Debt Setoff Act . . . . . . . . . . . . ........... . . 17
58.1-524 -
58.1-528 HB 762 TAX Administration: Debt Setoff Act . . . . . . . . . . . . . ........... . 17
58.1-530 SB 168 TAX Administration: Debt Setoff Act . . . . . . . . . . . . .......... . . 17
58.1-530 HB 762 TAX Administration: Debt Setoff Act . . . . . . . . . . . . . .......... . 17
58.1-609.3 SB 120 Sales and Use Tax: Various Exemptions Extended . . . ........ 13
58.1-609.4 SB 120 Sales and Use Tax: Various Exemptions Extended . . ........ . 13
58.1-609.7 HB 224 Sales and Use Tax: Drug Samples . . . . . . . . . . . . . . .......... . . 12
58.1-609.7 SB 4 Sales and Use Tax: Exemption for Organization
Supporting a Medical College . . . . . . . . . . . . . . . . . . . ............ . . 12
INDEX -- BY CODE SECTION
VA. CODE § BILL NO. SUBJECT MATTER PAGE
58.1-609.7 SB 416 Sales and Use Tax: Defers Nonprescription
Drugs Exemption . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 14
58.1-609.7 HB 1477 Sales and Use Tax: Defers Nonprescription
Drugs Exemption . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 14
58.1-609.8 SB 120 Sales and Use Tax: Various Exemptions Extended . . . . 13
58.1-905 HB 668 Income Tax: Tax Relief for Participants in
OPERATION JOINT ENDEAVOR . . . . . . . . . . . . . . . . . . . . 8
58.1-1101 HB 741 Tangible Personal Property: Manufacturers'
Office Equipment . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .... . 22
58.1-1803 SB 157 TAX Administration: Contract Collectors . . . . . . . . . . . . . 18
58.1-1803 HB 402 TAX Administration: Contract Collectors . . . . . . . . . . . . . 18
58.1-1805 HB 1451 TAX Administration: Taxpayer Bill of Rights . . . . . . . . . . . 3
58.1-1817 HB 1451 TAX Administration: Taxpayer Bill of Rights . . . . . . . . . . . 3
58.1-1818 HB 1451 TAX Administration: Taxpayer Bill of Rights . . . . . . . . . . . 3
58.1-1823 SB 182 TAX Administration: Amended Returns/Statute
of Limitations . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . ..... . . . 17
58.1-1823 HB 583 TAX Administration: Amended Returns/Statute
of Limitations . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .... . . . 17
58.1-1834 HB 1451 TAX Administration: Taxpayer Bill of Rights . . . . . . . . . . . . 3
58.1-1835 HB 1451 TAX Administration: Taxpayer Bill of Rights . . . . . . . . . . . . 3
58.1-1845 HB 1451 TAX Administration: Taxpayer Bill of Rights . . . . . . . . . . . . 3
58.1-2600 SB 629 Personal Property Tax: Common Carriers of
Property by Motor Vehicle . . . . . . . . . . . . . . . . . . . . . . . .... . . 20
58.1-2660 SB 629 Personal Property Tax: Common Carriers of
Property by Motor Vehicle . . . . . . . . . . . . . . . . . . . . . . . .... . . 20
58.1-3012 HB 782 Local: Time Limitation on Changes in
Local Tax Rates . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . ..... . . . 30
58.1-3018 HB 772 Local: Third Party Tax Payment Agreements . . . . . . . . . . . 30
58.1-3112 HB 773 Powers and Duties of Treasurers and
Commissioners of Revenue . . . . . . . . . . . . . . . . . . . . . . .... . . 30
58.1-3129 HB 773 Powers and Duties of Treasurers and
Commissioners of Revenue . . . . . . . . . . . . . . . . . . . . .... . . . . 30
58.1-3203 HB 217 Taxation of Leasehold Interests in Exempt
Church Property . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . ...... . . 23
58.1-3213 HB 275 Personal Property Tax: Elderly/Handicapped
Exemption . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . ....... . . 23
58.1-3220.01HB 892 Real Property Tax Credit for Rehabilitated
Residential Property . . . . . . . . . . . . . . . . . . . . . . . . . . ...... . . . . 23
58.1-3503 HB 678 Personal Property Tax: Classification of
Programmable Computer Equipment . . . . . . . . . . . . . . . . ... . 20
58.1-3506 SB 631 Personal Property Tax: Clarifies Definition of
Motor Carrier Transportation Property . . . . . . . . .... . . . . . . . . . 21
INDEX -- BY CODE SECTION
VA. CODE § BILL NO. SUBJECT MATTER PAGE
58.1-3506 SB 108 Personal Property Tax: Exemption for Volunteer
Rescue Squad and Fire Department Members . . . . . . . . . 21
58.1-3506 SB 186 Personal Property Tax: Late Filing of Certifications
by Volunteer Rescue Squad and Fire Department
Members and Auxiliary Police Officers . . . . . . . . . . . . ... . 21
58.1-3508.1 HB 496 Personal Property Tax: Semiconductor
Manufacturers and Food Processors . . . . . . . . . . . . . .... . . 20
58.1-3516 SB 630 Personal Property Tax: Proration of Motor Carrier
Property Used in Interstate Commerce . . . . . . . . . . ... . . . . 21
58.1-3518.1 HB 760 Tangible Personal Property: Alternative Filing
Methods . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . ...... . . 20
58.1-3603 SB 124 Personal Property Tax: Property Leased for
Charitable Purposes . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 29
58.1-3700 SB 587 BPOL: Uniform Ordinance . . . . . . . . . . . . . . . . . . . . . . . . . . . 24
58.1-3700 HB 293 BPOL: Uniform Ordinance . . . . . . . . . . . . . . . . . . . . . . . . . . . 24
58.1-3700.1 SB 587 BPOL: Uniform Ordinance . . . . . . . . . . . . . . . . . . . . . . . . . . . 24
58.1-3700.1 HB 293 BPOL: Uniform Ordinance . . . . . . . . . . . . . . . . . . . . . . . . . . . 24
58.1-3701 SB 587 BPOL: Uniform Ordinance . . . . . . . . . . . . . . . . . . . . . . . . . . . 24
58.1-3701 HB 293 BPOL: Uniform Ordinance . . . . . . . . . . . . . . . . . . . . . . . . . . . 24
58.1-3703 SB 587 BPOL: Uniform Ordinance . . . . . . . . . . . . . . . . . . . . . . . . . . . 24
58.1-3703 HB 293 BPOL: Uniform Ordinance . . . . . . . . . . . . . . . . . . . . . . . . . . . 24
58.1-3703.1 SB 587 BPOL: Uniform Ordinance . . . . . . . . . . . . . . . . . . . . . . . . . . . 24
58.1-3703.1 HB 293 BPOL: Uniform Ordinance . . . . . . . . . . . . . . . . . . . . . . . . . . . 24
58.1-3706 SB 587 BPOL: Uniform Ordinance . . . . . . . . . . . . . . . . . . . . . . . . . . . 24
58.1-3706 HB 293 BPOL: Uniform Ordinance . . . . . . . . . . . . . . . . . . . . . . . . . . . 24
58.1-3708 SB 587 BPOL: Uniform Ordinance . . . . . . . . . . . . . . . . . . . . . . . . . . . 24
58.1-3708 HB 293 BPOL: Uniform Ordinance . . . . . . . . . . . . . . . . . . . . . . . . . . . 24
58.1-3713 SB 347 Local: Allocation of Coal and Gas Road
Improvement Tax . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . ... 27
58.1-3713.01SB 347 Local: Allocation of Coal and Gas Road
I mprovement Tax . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .... . 27
58.1-3732 SB 587 BPOL: Uniform Ordinance . . . . . . . . . . . . . . . . . . . . . . . . . . . 24
58.1-3732 HB 293 BPOL: Uniform Ordinance . . . . . . . . . . . . . . . . . . . . . . . . . . . 24
58.1-3819 SB 594 Transient Occupancy Tax: Counties of Arlington,
Loudoun, Nelson, Spotsylvania, and York . . . . . . . . . . . . . . . 28
58.1-3822 HB 68 Transient Occupancy Tax: Arlington County . . . . . . . . . . . . 27
58.1-3823 SB 556 Transient Occupancy Tax: Counties of
Chesterfield, Hanover, and Henrico . . . . . . . . . . . . . . . . . . . . 27
58.1-3850 SB 584 Local: Technology Zones for Cities,
Counties, and Towns . . . . . . . . . . . . . . . . . . . . . . . . . . . . ... . . 29
58.1-3907 HB 422 Local Daily Rental Property Tax: Willful
Failure to File . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .... . . 31
INDEX -- BY CODE SECTION
VA. CODE § BILL No. SUBJECT MATTER PAGE
58.1-3912 HB 773 Powers and Duties of Treasurers and
Commissioners of Revenue . . . . . . . . . . . . . . . . . . . . . . . . 30
58.1-3919 HB 773 Powers and Duties of Treasurers and
Commissioners of Revenue . . . . . . . . . . . . . . . . . . . . . . . . 30
58.1-3914 HB 888 Local: Tax Payment Receipts . . . . . . . . . . . . . . . . . . . . . . . 31
58.1-3940 HB 773 Powers and Duties of Treasurers and
Commissioners of Revenue . . . . . . . . . . . . . . . . . . . . . . . . 30
58.1-3941 HB 773 Powers and Duties of Treasurers and
Commissioners of Revenue . . . . . . . . . . . . . . . . . . . . . . . . 30
58.1-3942 HB 671 Local Tax Enforcement: Priority of Liens . . . . . . . . . . . . . . 30
58.1-3965 HB 773 Powers and Duties of Treasurers and
Commissioners of Revenue . . . . . . . . . . . . . . . . . . . . . . . . . 30
59.1-279 SB 553 Income Tax: Enterprise Zones . . . . . . . . . . . . . . . . . . . . . . . 7
59.1-279 HB 1066 Income Tax: Enterprise Zones . . . . . . . . . . . . . . . . . . . . . . . 7
63.1-323 SB 420 Income Tax: Defers Expiration of Neighborhood
Assistance Act Credit . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 8
63.1-323 HB 1476 Income Tax: Defers Expiration of Neighborhood
Assistance Act Credit . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 8
Rulings of the Tax Commissioner