Tax Type
Corporation Income Tax
Description
Exempt organizations; Federally exempt business league
Topic
Taxpayers' Remedies
Date Issued
06-26-1997
June 26, 1997
Re: Ruling Request: Corporate Income Tax
Dear***********
This will reply to your letter concerning whether a nonprofit corporation, which qualifies as a tax-exempt business league under Internal Revenue Code (IRC) § 501 (c)(6), is subject to Virginia corporate income tax. I apologize for the delay in responding to your letter.
RULING
Code of Virginia § 58.1-401(5) and Title 23 of the Virginia Administrative Code (VAC) 10--120-90(F) provide that corporations, which are exempt from federal income tax under l.R.C. § 503(c), are exempt from Virginia corporate income tax. To the extent that a business league qualifies for exemption from federal income tax under l.R.C. § 501 (c)(6), the business league would also qualify for exemption from the Virginia corporate income tax. If such a corporation, however, has unrelated business taxable income, as defined in l.R.C. § 512, it is subject to Virginia corporate income tax on such income.
I trust this will answer the question posed in your letter, however, please contact ***** at *** if you need additional assistance.
Sincerely,
Danny M. Payne
Tax Commissioner
OTP/12348N
Rulings of the Tax Commissioner