Ezel / Tax Rulings / VA
VA P.D. 15-201 Income Tax 2015-10-19

Could a winery receive Virginia's 2014 Farm Wineries and Vineyards Tax Credit after filing its application after April 1, 2015?

Short answer: No. Virginia required the 2014 credit application and supporting documents by April 1, 2015. Because the credit had a $250,000 annual cap that could require pro-rata allocation among timely applicants, the Department enforced a hard deadline and denied the late application.

Apply this to your situation

This page answers the general question as of 2015. Ezel answers yours, under current Virginia tax law, with citations.

Currency note: this ruling is from 2015
Subsequent statutory amendments, regulation changes, court decisions, or later rulings may have changed the analysis. Treat this page as historical context, not current tax advice. Verify current law before relying on any specific rule, rate, or position mentioned here.
Disclaimer: This is an official Virginia Tax Commissioner determination on one taxpayer's 2014 Farm Wineries and Vineyards Tax Credit application. It reflects the $250,000 annual cap and April 1 filing rule applied in 2015; credit amounts, deadlines, forms, funding, or later law can change. Another applicant should not assume late-filing relief is available. This summary is informational only and is not legal or tax advice.
About this page: The plain-English summary, reader guidance, and Q&A below were written by Ezel based on the official state tax ruling. The original ruling (linked on this page as a PDF) is the authoritative source for any reliance.
View original ruling (PDF)

Subject

Late winery and vineyard credit application was denied

Plain-English summary

Virginia denied the credit because the application arrived after the April 1 deadline. The Farm Wineries and Vineyards Tax Credit equaled 25% of qualifying capital expenditures, but the total credit available to all taxpayers was capped at $250,000 per year.

Timely applications were necessary so the Department could allocate the capped amount pro rata if claims exceeded the limit. Treating April 15 as the deadline did not excuse the late filing; the Form FWV instructions and income-tax instructions stated April 1.

Result: the taxpayer could not receive the credit for 2014.

What this means for you

  • Track application deadlines separately from ordinary income-tax return deadlines.
  • Submit the required form and supporting documents by the credit-specific date.
  • Capped credits often use hard deadlines because all timely applicants share a limited pool.
  • Do not assume a late application can be accepted without express authority.

Common questions

Q: Why was April 1 enforced strictly?

A: The annual cap could require pro-rata allocation among all timely applicants.

Q: Was April 15 the correct deadline?

A: No. The application instructions required filing by April 1.

Q: What percentage of qualified costs could the credit cover?

A: The ruling states 25%, subject to the annual statewide cap.

Citations and references

  • Va. Code § 58.1-339.12.

Source

Original ruling text

October 19, 2015

Re: § 58.1-1821: Farm Wineries and Vineyards Tax Credit Application

Dear *:

This will reply to your letter in which you appeal the denial of an application for the farm wineries and vineyards tax credit (the "Credit") submitted by (the "Taxpayer") for the 2014 taxable year.

FACTS

The Taxpayer filed its application for the Credit after the April 1, 2015 deadline required for claiming the Credit for the 2014 taxable year. The Department denied certifying the Credit. The Taxpayer states that it presumed the deadline for filing was April 15 and requests that the Department grant the Credit.

DETERMINATION

Virginia Code 58.1-339.12 allows individual and corporate taxpayers to claim a credit for Virginia farm wineries and vineyards in an amount equal to 25 percent of the cost of all qualified capital expenditures made in connection with the establishment of new Virginia farm wineries and vineyards and capital improvements made to existing Virginia farm wineries and vineyards. The total amount of the Credit available for all taxpayers for each calendar year is limited to $250,000. If applications for the Credit exceed $250,000, the Department allocates the Credit to all applicants on a pro rata basis.

In order to receive the Credit, an eligible taxpayer must submit Form FWV and any supporting documentation to the Department no later than April 1 in order to claim the Credit for the preceding taxable year. This requirement is clearly set forth in the instructions for the application and in the corporate and individual income tax instructions.

Because the Credit is subject to an annual cap, the Department must have a deadline for tax credit applications. Adopting a policy of approving late applications for the Credit could result in the amount of tax credits exceeding the tax credit cap for a particular year. The Department's policy of establishing a hard deadline for capped tax credits has been applied to all capped tax credits that are administered by the Department. See Public Document (P.D.) 04-201 (11/4/2004) and P.D. 13-189 (10/18/2013).

In this case, the Taxpayer submitted its 2014 Form FWV to the Department after the April 1, 2015 deadline passed. Because the Taxpayer failed to submit its application in a timely fashion, the Taxpayer's request cannot be granted.

The Code of Virginia sections and public documents cited are available on-line at www.tax.virginia.gov in the Laws, Rules & Decisions section of the Department's web site. If you have any questions regarding this response, you may contact * in the Office of Tax Policy, Appeals and Rulings, at ***.

Sincerely,

Craig M. Burns
Tax Commissioner

AR/1-6038353191.B

Get today's answer for your situation

You just read a 2015 ruling on this question. Ezel checks current Virginia tax law and answers your specific situation, with citations.

Opens in Ezel Pro. Every answer cites the authority it relies on.