Does sending a 'notice of intent to appeal' preserve my Virginia tax appeal, or must I file the complete application for correction within 90 days?

Plain-English summary

A commercial bakery was audited for retail sales and use tax over a six-year period and wanted to fight the result — it believed the Department wrongly taxed purchases used for quality-control testing, sanitizing, and cleaning, and that the audit treated similar purchases inconsistently. Those may be real arguments, but the Commissioner never reached them, because the bakery's appeal was filed too late.

The 90-day appeal deadline

Virginia gives a taxpayer 90 days from the date of an assessment to apply to the Tax Commissioner for relief (Va. Code § 58.1-1821). Critically, the regulation is explicit that a half-step doesn't preserve your rights: "An incomplete appeal or notice of intent to appeal does not satisfy or extend the 90-day limitation period" (23 VAC 10-20-165 D 4).

Here the timeline was fatal. The audit assessment was issued on March 3, 2025. On May 2, 2025, the bakery sent a notice of intent to file — acknowledging it knew about the 90-day period and meant to file on time. But it didn't file the actual application for correction until June 10, 2025, after the 90 days had run. Because a notice of intent neither counts as an appeal nor extends the deadline, the Department was barred by statute from considering the application. The filing was closed and the assessment remained due and payable (with 30 days to pay the updated bill before more interest accrues).

What this means for you

File the complete appeal within 90 days — a notice of intent won't hold your place

If you receive a Virginia tax assessment you want to contest, you must file a complete application for correction within 90 days of the assessment date. Announcing that you intend to appeal — or sending a partial or incomplete appeal — does not stop the clock or buy you extra time (23 VAC 10-20-165 D 4). Knowing about the deadline, as this taxpayer did, is not the same as meeting it.

Practical steps

Calendar the 90th day the moment an assessment arrives, and build in a margin. Make sure your application is complete — it must set out the grounds and all relevant facts — because an incomplete filing is treated the same as no timely filing. If you're still gathering documentation, file a complete appeal on the issues you have and supplement it, rather than sending only a notice of intent.

The merits still matter — but only if you're timely

The bakery's underlying questions (whether testing, sanitizing, and cleaning supplies qualify for a manufacturing or other exemption) were never decided. A late appeal forfeits even a potentially strong position, so protect the deadline first.

Common questions

Q: I told the Department I intend to appeal. Doesn't that preserve my rights?
A: No. Under 23 VAC 10-20-165 D 4, a notice of intent to appeal does not satisfy or extend the 90-day deadline. You must file a complete application for correction within 90 days of the assessment.

Q: How long do I have to appeal a Virginia assessment?
A: 90 days from the date of the assessment (Va. Code § 58.1-1821), and the application must be complete.

Q: My appeal was a few days late. Can the Department still consider it?
A: No. Once the 90-day period expires, the Department is barred by statute from considering the application, regardless of the merits.

Q: What happened to the bakery's exemption arguments?
A: They were never decided. Because the appeal was untimely, the assessment stands and the merits were not reached.

Citations and references

Statutes and regulations:

• Va. Code § 58.1-1821 — a taxpayer has 90 days from the assessment date to apply to the Tax Commissioner for relief
• 23 VAC 10-20-165 — appeal filing requirements; subsection D 4 provides that an incomplete appeal or notice of intent to appeal does not satisfy or extend the 90-day period

Source

• Landing page: Virginia Laws, Rules & Decisions
• Ruling: P.D. 25-120

Original ruling text

November 14, 2025

Re: § 58.1-1821 Appeal: Retail Sales and Use Tax

Dear * :

This will respond to your letter in which you seek correction of the retail sales and use tax assessment issued to * (the “Taxpayer”) resulting from an audit for the period August 2017 through July 2023.

FACTS

A first generation audit was conducted on the books and records of the Taxpayer, a commercial bakery, for the period at issue. The audit concluded that certain purchases were either of parts and equipment not used in the manufacturing process, they lacked invoices, or were of materials not used in exempt activities and therefore listed those purchases as exceptions. The Taxpayer filed an application for correction contending that the audit was inconsistent with the treatment of the purchases and erroneously disallowed items purchased for quality control testing, sanitizing, and cleaning.

ANALYSIS

Virginia Code § 58.1-1821 states that “[a]ny 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.” Title 23 of the Virginia Administrative Code (VAC) 10-20-165 interprets Virginia Code § 58.1-1821 and sets out requirements for the filing of administrative appeals. Subsection D 4 of this regulation states: “An incomplete appeal or notice of intent to appeal does not satisfy or extend the 90-day limitation period.”

The audit assessment was issued on March 3, 2025. The Taxpayer submitted a notice of intent to file an application on May 2, 2025 indicating that it was aware of the 90-day limitation period and it intended to timely file its application for correction. The Taxpayer filed its application with the Department on June 10, 2025, after the 90-day statutory requirement had expired. Consequently, the Department is barred by the statute from considering the application.

DETERMINATION

In accordance with the facts available and the authorities cited, the Department is, therefore, closing this filing, and the assessment remains due and payable. An updated bill, with interest accrued to date, will be mailed shortly to the Taxpayer. No further interest will accrue provided the outstanding assessment is paid within 30 days from the date of the bill.

The Code of Virginia section and regulation cited are available online at law.lis.virginia.gov. If you have any questions regarding this determination, you may contact * in the Office of Tax Policy and Legal Affairs, Tax Adjudication and Resolution Division, at or **.

Sincerely,

James J. Alex
Tax Commissioner
Commonwealth of Virginia

AR/5242.B