Tax Type
Corporation Income Tax
Description
Extension of time for filing returns; Failure to file tentative return
Topic
Returns and Payments
Date Issued
08-21-1996
August 21, 1996
Re: § 58.1-1821 Application: Corporate Income Tax
Dear***********
This will reply to your letter of April 5, 1996 in which you contest the assessment of late penalties and associated interest on the 1994 Virginia Corporation Income Tax return for ********(the Taxpayer). Based on the circumstances involved, your request will be treated as an appeal as provided for in Code of Virginia § 58.1-1821.
FACTS
In 1994 the Taxpayer made estimated tax payments totaling *******With the filing of the 1994 return on October 13, 1995, the taxpayer paid a remaining balance*********The department calculated and assessed penalty and interest for the late filing and late payment of the corporate return. The Taxpayer did not file a Virginia Corporation Income Tax Extension Payment Voucher and Tentative Tax Return (Form 500-E) but did file Form 7004 with the Internal Revenue Service requesting a federal filing extension. The Taxpayer seeks to have the application of the penalty and associated interest abated on the basis that the corporation qualified for an automatic extension of time under Code of Virginia § 58.1-453(A).
The Taxpayer further states that***** the officer listed on the tax records, is not an active member of the company and resigned prior to the filing of the corporate return. A request has been made to remove the officer's name from the tax records.
DETERMINATION
Application of Penalty
Code of Virginia § 58.1-453(A) grants an extension for filing the Virginia income tax return when a federal extension has been allowed. Subsection A also requires "that the estimated tax due is paid in accordance with the provisions of subsection C." Code of Virginia § 58.1-453 (C) provides in pertinent part that:
-
- Any taxpayer desiring an extension of time in accordance with the provisions of subsection A or B shall, on or before the original due date for the filing of such returns, in accordance with the procedures established by the Tax Commissioner pay the full amount properly estimated as the balance of the tax due for the taxable year after giving effect to any estimated tax payments.... (Emphasis added.)
The provision established for filing a Virginia extension is set forth in Virginia Regulation (VR) 630-3-453 (copy enclosed) which requires a corporation to file a tentative return when requesting an extension of time for filing a corporate tax return. In addition, a corporation must include full payment of the tax liability estimated on the tentative return less any credits or estimated payments. The application must be filed on or before the original due date of the return.
Based on the facts presented in your letter, the Taxpayer did not file a Virginia extension return by the original due date of the 1994 Virginia Corporation Income Tax return. As a result, there is no basis for accepting your request to abate the penalty and associated interest. As of the date of your request, the outstanding assessment was*** which represents*****in penalty and in interest. The department will waive the additional interest that accrued since your request was received. Please remit your payment within the next 60 days to avoid additional interest charges. Your payment may be directed to****Office of Tax Policy, Virginia Department of Taxation, P.O. Box 1880, Richmond Virginia 23218-1880.
Corporate Officer
is still listed as active in the capacity of president of your corporation according to the records of the State Corporation Commission. Please complete the enclosed Combined Registration Application Form (Form R-1) and include names, addresses, social security numbers and titles of all current officers and our records will be adjusted accordingly. This information should also be directed to *******at the mailing address referenced above. If you have any questions regarding this ruling, you may contact ******* at ************* .
Sincerely,
Danny M. Payne
Tax Commissioner
OTP/11138O
Rulings of the Tax Commissioner