Could a taxpayer appeal a city BTPP assessment to the Tax Commissioner while the city was still requesting information and had not denied the local appeal?

Plain-English summary

The Department closed the state appeal because the city's local appeal process was still active. The taxpayer had not filed a 2011 property return, and the city issued an estimated assessment. After the taxpayer appealed locally, the city addressed some concerns but requested more information rather than denying the appeal.

Virginia allowed a state appeal within 90 days after a local assessing official denied an appeal in whole or in part. A request for more information was not a final local determination.

A taxpayer could also treat a local appeal as denied after it remained pending more than one year, with at least 30 days' written notice to the locality. This appeal had been filed in November 2011, so that option was not available until November 2012.

Because neither route was open, the Department lacked authority and closed the case without deciding the BTPP merits.

Common questions

Q: Was the city's information request a final denial?
A: No. It left the local appeal pending.

Q: Could the taxpayer preserve a state appeal before the local process ended?
A: Not through this filing. The statutory prerequisites had not been satisfied.

Citations and references

• Va. Code § 58.1-3983.1(B)(1), (B)(6), and (D)(1).
• Chapter 202, 1999 Acts of Assembly.

Subject

Department lacks the authority to address the Taxpayer's appeal still an active case in with the City.

Source

• Landing page: Virginia Laws, Rules & Decisions
• Ruling: P.D. 12-144

Original ruling text

August 30, 2012

Re: Appeal of Business Tangible Personal Property Tax

Taxpayer: *

Locality: *

Dear *:

This is in response to the application for correction filed on behalf of your client, * (the "Taxpayer"), in which you contest the denial of refunds and assessments of business tangible personal property (BTPP) tax by the *** (the "City") for the 2011 tax year.

The Taxpayer failed to file a local property tax return with the City for the 2011 tax year. The City issued an assessment based on information previously received from the Taxpayer. On November 30, 2011, the Taxpayer filed an appeal with the City seeking correction of the assessment, citing numerous errors made by the City. In January 2012, the City responded to the Taxpayer's appeal. While the City addressed some of the Taxpayer's complaints in general terms, it concluded that the Taxpayer had not filed a complete appeal and requested that the Taxpayer submit additional information. Rather than respond to the City's request for additional information, the Taxpayer filed an appeal with the Tax Commissioner. The Taxpayer asserts that it filed the appeal in order to preserve the right to a state appeal while the circuit court considers the matter.

The local business tax appeals process was enacted by the General Assembly in 1999 (Chapter 202, Acts of Assembly ) so that taxpayers could have an administrative alternative to filing suit in court. To that end, Virginia Code § 58.1-3983.1 B 1 provides that any person assessed with:

any . . . local business tax as defined in this section may appeal such assessment within one year from the last day of the tax year for which such assessment is made, or within one year from the date of such assessment, whichever is later, to the commissioner of the revenue or other assessing official.

Pursuant to Va. Code § 58.1-3983.1 D 1, if a taxpayer's appeal is denied in part or whole by the local assessing official, the taxpayer may, within 90 days, appeal the assessment to the Tax Commissioner. In this case, the City responded to the Taxpayer's letter with a request for additional information. Because the City has not denied the Taxpayer's appeal in part or in whole, the City's letter in January 2012 is not a final local determination.

Further, pursuant to Va. Code § 58.1-3983.1 B 6, a taxpayer whose administrative appeal to the local assessing officer has been pending for more than one year may, with not less than 30 days written notice to such local assessing official, elect to treat the appeal as denied and file an appeal to the Tax Commissioner. Because the Taxpayer's letter appealing the 2011 assessment was filed in November 2011, the Taxpayer could not make such an election until November 2012.

For the reasons stated above, the Department lacks the authority to address the Taxpayer's appeal. Therefore, the Taxpayer's case filed with the Department has been closed.

If you have any questions regarding this response, you may call * in the Office of Tax Policy, Appeals and Rulings, at ***.

Sincerely,

Craig M. Burns

Tax Commissioner

AR/1-5050881961.o