Authority: Title 3.2; Title 58.1, Code of Virginia.
A. Pursuant to § 58.1-1803, Code of Virginia, the Tax Commissioner is hereby authorized to contract with private collection agencies for the collection of delinquent accounts. The State Comptroller is hereby authorized to deposit collections from such agencies into the Contract Collector Fund (§ 58.1-1803, Code of Virginia). Revenue in the Contract Collector Fund may be used to pay private collection agencies/attorneys and perform oversight of their operations, upgrade audit and collection systems and data interfaces, and retain experts to perform analysis of receivables and collection techniques. Any balance in the fund remaining after such payment shall be deposited into the appropriate general, nongeneral, or local fund no later than June 30 of each year.
B.1. The Department of Taxation is authorized to retain, as special revenue, its reasonable share of any court fines and fees to reimburse the department for any ongoing operational collection expenses.
2. Any form of state debt assigned to the Department of Taxation for collection may be collected by the department in the same manner and means as state taxes may be collected pursuant to Title 58.1, Chapter 18, Code of Virginia.
C. The Department of Taxation is hereby appropriated revenues from the Communications Sales and Use Tax Trust Fund to recover the direct cost of administration incurred by the department in implementing and collecting this tax as provided by § 58.1-662, Code of Virginia.
D. The Tax Commissioner shall have the authority to waive penalties and grant extensions of time to file a return or pay a tax, or both, to any class of taxpayers when the Tax Commissioner in his discretion finds that the normal due date has, or would, cause undue hardship to taxpayers who were, or would be, unable to use electronic means to file a return or pay a tax because of a power or systems failure that causes the department's electronic filing or payment systems to be nonfunctional for all or a portion of a day on or about the due date for a return or payment.
E. The Department of Taxation is hereby appropriated Land Conservation Incentive Act fees imposed under § 58.1-513 C. 2., Code of Virginia, on the transferring of the value of the donated interest. The Code of Virginia specifies such fees will be used by the Departments of Taxation and Conservation and Recreation to recover the direct cost of administration incurred in implementing the Virginia Land Conservation Act.
F. In the event that the United States Congress adopts legislation allowing local governments, with the assistance of the Commonwealth, to collect delinquent local taxes using offsets from federal income taxes, the Department of Accounts shall provide a treasury loan to the Department of Taxation to finance the costs of modifying the agency's computer systems to implement this federal debt setoff program. This treasury loan shall be repaid from the proceeds collected from the offsets of federal income taxes collected on behalf of localities by the Department of Taxation.
G. 1. All revenue received by the Commonwealth pursuant to the provisions of § 58.1-645 et seq., Code of Virginia, shall be paid into the state treasury and deposited to the Virginia Communications Sales and Use Tax Fund and shall be distributed pursuant to § 58.1-662, Code of Virginia, and Items 273 and 294 of this act. For the purposes of the Comptroller's preliminary and final annual reports required by § 2.2-813, Code of Virginia, however, all deposits to and disbursements from the Fund shall be accounted for as part of the general fund of the state treasury.
2. It is the intent of the General Assembly that all such revenues be distributed to counties, cities, and towns, the Department for the Deaf and Hard-of-Hearing, and for the costs of administering the Virginia Communications Sales and Use Tax.
H. Notwithstanding the provisions of § 58.1-478, Code of Virginia, effective July 1, 2011, every employer whose average monthly liability can reasonably be expected to be $1,000 or more and the aggregate amount required to be withheld by any employer exceeds $500 shall file the annual report required by § 58.1-478, Code of Virginia, and all forms required by § 58.1-472, Code of Virginia, using an electronic medium using a format prescribed by the Tax Commissioner. Waivers shall be granted only if the Tax Commissioner finds that this requirement creates an unreasonable burden on the employer. All requests for waiver shall be submitted to the Tax Commissioner in writing.
I. Notwithstanding the provisions of § 58.1-214, Code of Virginia, the department shall not be required to mail its forms and instructions unless requested by a taxpayer or his representative.
J.1. Notwithstanding the provisions of § 58.1-609.12, Code of Virginia, no report on the fiscal, economic and policy impact of the miscellaneous Retail Sales and Use Tax exemptions under § 58.1-609.10, Code of Virginia, shall be required after the completion of the final report in the first five-year cycle of the study, due December 1, 2011. The Department of Taxation shall satisfy the requirement of § 58.1-609.12 that it study and report on the annual fiscal impact of the Retail Sales and Use Tax exemptions for nonprofit entities provided for in § 58.1-609.11, Code of Virginia, by publishing such fiscal impact on its website.
2. Notwithstanding the provisions of § 58.1-202, Code of Virginia, no report detailing the total amount of corporate income tax relief provided in Virginia shall be required after the completion of such report due on October 1, 2013. The Department of Taxation shall satisfy the requirement of § 58.1-202 that it issue an annual report detailing the total amount of corporate income tax relief provided in Virginia by publishing its Annual Report on its website.
K. 1. Notwithstanding any provision of the Code of Virginia or this act to the contrary,
a. Effective January 1, 2013, all corporations are required to file estimated tax payments and their annual income tax return and final payment using an electronic medium in a format prescribed by the Tax Commissioner .
b. Effective July 1, 2013, every employer shall file the annual report required by § 58.1-478 and all forms required by § 58.1-472, Code of Virginia, using an electronic medium in a format prescribed by the Tax Commissioner.
c. Effective July 1, 2014, every employer shall file the annual report required by § 58.1-478 , not later than January 31 of the calendar year succeeding the calendar year in which wages were withheld from employees.
d. Effective January 1, 2015, for taxable years beginning on and after January 1, 2014, every pass-through entity shall file the annual return required by § 58.1-392, Code of Virginia, and make related payments using an electronic medium in a format prescribed by the Tax Commissioner.
e. i. Effective until January 1, 2020, all estates and trusts are required to file estimated tax payments pursuant to § 58.1-490 et seq., Code of Virginia, and their annual income tax return pursuant to § 58.1-381, Code of Virginia, and final payment using an electronic medium in a format prescribed by the Tax Commissioner.
ii. Effective January 1, 2020, annual income tax returns of estates and trusts required pursuant to § 58.1-381, Code of Virginia, that are prepared by an income tax return preparer, as defined in § 58.1-302, Code of Virginia, must be filed using an electronic medium in a format prescribed by the Tax Commissioner.
f. Taxpayers subject to the taxes imposed pursuant to § 58.1-320 and required to pay estimated tax pursuant to § 58.1-490 et seq., shall be required to file and remit using an electronic medium in a format prescribed by the Tax Commissioner all installment payments of estimated tax and all payments made with regard to a return or an extension of time to file if (i) any one such payment exceeds or is required to exceed $7,500, or if (ii) the taxpayer's total tax liability exceeds or can be reasonably expected to exceed $30,000 in any taxable year beginning on or after January 1, 2018. The Department of Taxation shall provide reasonable advanced notice to taxpayers affected by this requirement.
2.a. The Tax Commissioner shall have the authority to waive the requirement to file or pay by electronic means. Waivers shall be granted only if the Tax Commissioner finds that this requirement creates an unreasonable burden on the person required to use an electronic medium. All requests for waiver shall be submitted to the Tax Commissioner in writing.
b. The Tax Commissioner shall have the authority to waive the requirement to file or pay by January 31. Waivers shall be granted only if the Tax Commissioner finds that this requirement creates an unreasonable burden on the person required to file or pay by January 31. All requests for waiver shall be submitted to the Tax Commissioner in writing.
L.1. Notwithstanding any other provision of law, Retail Sales and Use Tax returns and payments shall be made using an electronic medium prescribed by the Tax Commissioner beginning with the June 2012 return, due July 2012, for monthly filers and, for less frequent filers, with the first return they are required to file after July 1, 2013.
2. Notwithstanding any other provision of law, Out-of-State Dealer's Use Tax and Business Consumer's Use Tax returns and payments shall be made using an electronic medium prescribed by the Tax Commissioner beginning with the July 2017 return, due August 2017, for monthly filers and, for less frequent filers, with the first return they are required to file after August 1, 2017.
3. The Tax Commissioner shall have the authority to waive the requirement to file by electronic means upon a determination that the requirement would cause an undue hardship. All requests for waiver shall be transmitted to the Tax Commissioner in writing.
M. The Department of Taxation is hereby appropriated revenues from the Virginia Motor Vehicle Rental Tax to recover the direct cost of administration incurred by the department in implementing and collecting this tax as provided by § 58.1-1741, Code of Virginia.
N. Notwithstanding the provisions of § 58.1-490 et seq., Code of Virginia,
1. Effective for taxable years beginning on or after January 1, 2015, a taxpayer shall be permitted to file a declaration of estimated tax with the Department of Taxation instead of with the commissioner of the revenue and notwithstanding the provisions of § 58.1-306, Code of Virginia, the department may so advise taxpayers.
2. Effective January 1, 2015, every treasurer who receives an estimated income tax return, declaration or voucher pursuant to § 58.1-495 of the Code of Virginia shall transmit such return, declaration or voucher to the Department of Taxation using an electronic medium in a format prescribed by the Tax Commissioner.
O. Notwithstanding any provision of the Code of Virginia or this act to the contrary, the Department of Taxation is authorized to provide Form 1099 in an electronic format to taxpayers. The Tax Commissioner shall ensure that taxpayers may elect to receive the electronic version of the form.
P. The Department of Taxation is hereby appropriated revenues from the E-911 Wireless Tax to recover the direct cost of administration incurred by the department in implementing and collecting this tax as provided by § 56-484.17:1, Code of Virginia.
Q. The Department of Taxation is hereby appropriated revenues from the assessment for expenses pursuant to §§ 38.2-400 and 38.2-403, Code of Virginia, to recover any costs related to the Insurance Premiums License Tax that are incurred by the Department of Taxation, as provided in § 58.1-2533, Code of Virginia.
R. The Department of Taxation is authorized to recover the administrative costs associated with debt collection initiatives under the U.S. Treasury Offset Program authorized by § 2.2-4809, not to exceed twenty percent of revenues generated pursuant to such debt collection initiatives. Such sums are in addition to any fees charged by outside collections contractors and/or enhanced collection revenues returned to the Commonwealth.
S.1. Notwithstanding any other provision of the Code of Virginia or this act to the contrary, effective July 1, 2015, the Department of Taxation is hereby authorized to charge a fee of $5.00 per copy of a tax return requested by a taxpayer or a representative thereof.
2. The Tax Commissioner shall have the authority to waive such fee. Waivers shall be granted only if the Tax Commissioner finds that this requirement creates an unreasonable burden on the person requesting such copies. All requests for waiver shall be submitted to the Tax Commissioner in writing.
T. Notwithstanding any other provision of the Code of Virginia or this act to the contrary, effective January 1, 2016, the Department of Taxation shall not provide to the local commissioners of the revenue or any other local officials copies of federal tax forms or schedules, including but not limited to, federal Schedules C (1040), C-EZ (1040), D (1040), E (1040), or F (1040), or federal Forms 4562 or 2106, or copies of Virginia Schedule 500FED, unless such schedules or forms are attached to a Virginia income tax return and submitted to the department in an electronic format by the taxpayer.
U.1. Notwithstanding any other provision of law, Vending Machine Dealer's Sales Tax, Motor Vehicle Rental Tax and Fee, Communications Taxes, and Tobacco Products Tax returns shall be filed using an electronic medium prescribed by the Tax Commissioner beginning with the July 2016 return, due August 2016, for monthly filers and, for less frequent filers, with the first return they are required to file after July 1, 2016.
2. Notwithstanding any other provision of law, Litter Tax returns shall be filed and any payments shall be made using an electronic medium prescribed by the Tax Commissioner beginning with the first return required to be filed after January 1, 2018.
3. The Tax Commissioner shall have the authority to waive the requirement to file by electronic means upon a determination that the requirement would cause an undue hardship. All requests for waiver shall be transmitted to the Tax Commissioner in writing.
V.1. Notwithstanding any other provision of law, effective July 1, 2017, the Department of Taxation shall charge a fee of $275 for each request, except those requested by the local assessing officer, for a letter ruling to be issued pursuant to § 58.1-203, Code of Virginia, or for an advisory opinion issued pursuant to §§ 58.1-3701 or 58.1-3983.1, Code of Virginia; $50 for each request for an offer in compromise with respect to doubtful collectability authorized by § 58.1-105, Code of Virginia; and $100 for each request for permission to change a corporation's filing method pursuant to § 58.1-442, Code of Virginia.
2. The Tax Commissioner shall have the authority to waive such fees. Waivers shall be granted only if the Tax Commissioner finds that such fee creates an unreasonable burden on the person making such request. All requests for waiver shall be submitted to the Tax Commissioner in writing.
3. Revenues received from the above fees shall be deposited into the general fund in the state treasury.
W. Notwithstanding the provisions of § 38.2-5601, Code of Virginia, the Department of Taxation shall not be required to update the Virginia Medical Savings Account Plan report after the completion of such report due on December 31, 2016.
X.1. Notwithstanding any other provision of law, any employer or payroll service provider that owns or licenses computerized data relating to income tax withheld pursuant to Article 16 (§ 58.1-460 et seq.) of Chapter 3 of Title 58.1 shall notify the Office of the Attorney General without unreasonable delay after the discovery or notification of unauthorized access and acquisition of unencrypted and unredacted computerized data containing a taxpayer identification number in combination with the income tax withheld for that taxpayer that compromises the confidentiality of such data and that creates a reasonable belief that an unencrypted and unredacted version of such information was accessed and acquired by an unauthorized person, and causes, or the employer or payroll provider reasonably believes has caused or will cause, identity theft or other fraud. With respect to employers, this requirement applies only to information regarding the employer's employees, and does not apply to information regarding the employer's customers or other non-employees.
Such employer or payroll service provider shall provide the Office of the Attorney General with the name and federal employer identification number of the employer as defined in § 58.1-460 that may be affected by the compromise in confidentiality. Upon receipt of such notice, the Office of the Attorney General shall notify the Department of Taxation of the compromise in confidentiality. The notification required under this provision that does not otherwise require notification under subsections A through L of § 18.2-186.6, Code of Virginia, shall not be subject to any other notification, requirement, exemption, or penalty contained in that section.
2. Notwithstanding any other provision of law, any income tax return preparer, as defined in § 58.1-302, who prepares any Virginia individual income tax return during a calendar year for which he has the primary responsibility for the overall substantive accuracy of the preparation thereof shall notify the Department of Taxation without unreasonable delay after the discovery or notification of unauthorized access and acquisition of unencrypted and unredacted return information that compromises the confidentiality of such information and that creates a reasonable belief that an unencrypted and unredacted version of such information was accessed and acquired by an unauthorized person, and causes, or such preparer reasonably believes has caused or will cause, identity theft or other fraud.
Such income tax return preparer shall provide the Department of Taxation with the name and taxpayer identifying number of any taxpayer that may be affected by the compromise in confidentiality, as well as the name of the income tax return preparer, his preparer tax identification number, and such other information as the Department may prescribe.
Y.1. Every payment settlement entity required to file information returns under § 6050W of the Internal Revenue Code shall, within thirty days of the relevant federal deadline for filing such returns, submit to the Department of Taxation electronically either (i) a duplicate of all such information returns or (ii) a duplicate of such information returns related to participating payees with a Virginia state address or Virginia state taxpayers.
2. All third-party settlement organizations, as defined in § 6050W of the Internal Revenue Code, shall report to the Department of Taxation electronically, and to any participating payee, within 30 days of the relevant federal deadline for reporting such information, all information specified by § 6050W of the Internal Revenue Code with respect to reportable payment transactions made on or after January 1, 2020 to such participating payee. For purposes of determining whether a third-party settlement organization is subject to this requirement, the de minimis limitations of § 6041(a) of the Internal Revenue Code shall apply mutatis mutandis in lieu of the de minimis limitations of § 6050W of the Internal Revenue Code. This requirement shall apply only with respect to participating payees with a Virginia mailing address.
3. The Tax Commissioner shall have the authority to waive the requirement to submit this information upon a determination that the requirement would cause an unreasonable burden. In addition, the Tax Commissioner shall have the authority to waive the requirement to submit this information electronically upon a determination that the requirement would cause an unreasonable burden. All requests for waiver shall be transmitted to the Tax Commissioner in writing.
Z. The Department of Taxation is hereby appropriated revenues from the Disposable Plastic Bag Tax to recover any administrative costs for collecting the tax incurred by the Department of Taxation as provided by § 58.1-3835 (C), Code of Virginia.
AA. The Department of Taxation is hereby appropriated revenues from the tobacco products tax imposed under § 58.1-1021.02 of the Code of Virginia to recover any administrative costs for implementing the tax on heated tobacco products incurred by the Department of Taxation as provided by Item 3-5.21(D) of this Act.