Publications & Articles

Odin, Feldman & Pittleman attorney David Lawrence is a member of the Virginia Tax Roundtable that meets each year. The meeting participants include some Virginia Bar Association tax lawyers, the Virginia Tax Commissioner, and at this meeting, two Commissioners of Revenue. The following are five points & areas of focus that are of interest.

1. The Tax Department continues its big focus on domicile cases & non-resident audit initiatives to raise money without legislatively raising taxes. The state (& some counties) are using more & more computer matching to pick up cases. Continuing business ties & property ownership in Virginia are being traced. Entity tax returns, personal property returns, landlord & tenant reporting, and so on are all being cross-checked for leads.
    
2. The Tax Department has increased its individual audit programs & many times are ignoring federal tax returns to go independently behind deductions claimed on the returns.
    
3. More appeals are coming to the Tax Department both on income tax issues and local BPOL, sales taxes & property taxes. In order to fully win at the state level appeal, CPAs & lawyers must do a better job of getting all of the facts into the record for the appeal. The Tax Commissioner reported that many appeals have such skimpy facts that Appeals cannot make a decision. Instead, at the most, Appeals merely remands the case back to audit or the local county to reconsider. And, we know where that will go - no where good. If a taxpayer is going to go the the expense of an appeal, you want enough facts in the appeal & on the record so that the State can actually declare a winner & looser in concrete dollar terms. Otherwise, taxpayers are just wasting money on the appeal.
    
4. Local Commissioners of Revenue are stepping up their computer matching with information from local & state tax filings, landlord filing of tenant information, Zoning, ABC, Fire & Health Departments, and the like. They are trying to increase their BPOL & property tax revenue without legislatively raising taxes.
    
5. More & more larger businesses are reviewing their back local tax returns & filing appeals to claim refunds of overpayments of BPOL & personal property taxes. Many local tax returns are done in-house in a company's accounting department without much review. Many are paying tax on the total federal deprecation schedules even though many federal items are not subject to state tax (e.g., real estate improvements or tenant improvements on a personal property schedule). A word to the wise - there may be extra cash for taxpayers to recover by double-checking these local returns.
    

If you'd like any more information from this meeting, contact David Lawrence.