Did a timely notice of intent preserve a Virginia corporate-income-tax appeal when the complete appeal arrived after 90 days?

Subject

Complete administrative appeal not filed within 90 days after the assessment date

Plain-English summary

Virginia barred the corporate-income-tax appeal because the taxpayer submitted only a notice of intent within 90 days, not a complete appeal. A complete filing had to set out enough information and grounds for the Commissioner to make an informed determination.

The assessments were dated October 15, 2007. The taxpayer filed its notice on January 11, 2008 and said the full appeal would follow before February 15. Because the 90th day fell on Sunday, January 13, the deadline moved to January 14.

The full appeal arrived February 15. The notice of intent did not satisfy the completeness requirement, so the later submission could not relate back and the application was barred. The ruling did not reach the audit adjustments themselves.

What this means for you

• A protective notice may not preserve an appeal if the governing rules require complete grounds and supporting information by the deadline.
• Count consecutive calendar days, including weekends and holidays, subject to the applicable due-date rule.
• Do not wait to develop the substantive appeal until after filing a placeholder.

Common questions

Was the notice of intent timely? Yes, but it was not a complete appeal.

What was the last day for the complete filing? January 14, 2008, because day 90 fell on a Sunday.

Did Virginia decide whether the corporate assessments were correct? No. The appeal failed on timeliness.

Citations and references

• Va. Code § 58.1-1821.
• Administrative Appeal Guidelines §§ 3(A) and 4.2(A).
• P.D. 06-140 (November 29, 2006).

Source

• Landing page: Virginia Laws, Rules & Decisions
• Ruling: P.D. 08-25

Original ruling text

March 20, 2008

Re: § 58.1-1821 Application: Corporate Income Tax

Dear *:

This will reply to your notice of intent to seek correction of the corporate income tax assessments issued to * (the "Taxpayer") for the taxable years ended December 31, 2004 and 2005.

FACTS

The Department audited the Taxpayer for the taxable years at issue and made a number of adjustments to the Taxpayer's corporate income tax returns. Assessments, dated October 15, 2007, were issued to the Taxpayer. On January 11, 2008, the Taxpayer filed a notice of intent to file an administrative appeal. The notice indicated that the appeal would be filed prior to February 15, 2008.

DETERMINATION

Virginia Code § 58.1-1821 states, "Any person assessed with any tax administered by the Department of Taxation may, within ninety days from the date of such assessment, apply for relief to the Tax Commissioner." [Emphasis added.] Pursuant to the Administrative Appeal Guidelines for Tax Assessments Issued by the Virginia Department of Taxation (the "Guidelines") § 3 A, "The 90-day limitations period begins on the calendar day after the date of assessment and continues for 90 consecutive calendar days (including weekends and holidays)." See Public Document (P.D.) 06-140 (11/29/2006). The Guidelines mandate that a taxpayer file a complete appeal within the 90-day limitation period. A complete appeal means an administrative appeal containing sufficient information so that the grounds upon which the taxpayer relies in contesting an assessment are fully set forth to allow the Tax Commissioner to make an informed final determination. See § 4.2 A of the Guidelines .

Under these guidelines, the Taxpayer was required to file a complete administrative appeal within 90 days after the assessment date, or by January 14, 2008 (the 90th day, January 13, 2008, fell on a Sunday). The Taxpayer filed a notice of intent to appeal within the 90-day limitations period. The notice of intent, however, does not constitute a complete appeal under the Guidelines . A complete appeal was filed on February 15, 2008, well after the expiration of the 90-day limitations period. Therefore, because the Taxpayer failed to file a complete administrative appeal by January 14, 2008, its application for correction filed pursuant to Va. Code § 58.1-1821 is barred by statute.

The Code of Virginia section, Virginia regulation and public document cited, along with other reference documents, are available on.-line at www.tax.virginia.gov in the Tax Policy Library section of the Department's web site. If you have any questions about this response, you may contact * in the Office of Tax Policy, Appeals and Rulings, at ***.

Sincerely,

Janie E. Bowen

Tax Commissioner

AR/1-2063035333B