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Virginia Department of Taxation Legislative Update Presentation 2009

Learn about the latest legislative updates in Virginia taxation for 2009, including changes in conformity dates, tax benefits for taxpayers, college savings plans, real estate transactions, credits, exemptions, filing requirements, and upcoming tax changes.

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Virginia Department of Taxation Legislative Update Presentation 2009

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  1. Virginia Department of TaxationLegislative Update Presentation 2009

  2. Fixed-Date Conformity • HB 1737 and SB 985 – IRC Conformity Date Advanced • The date has advanced from December 31, 2007 to December 31, 2008 • The advancement allows the benefits of the following acts of Congress to flow through to Virginia taxpayers: • The Economic Stimulus Act, which increases 179 expensing; • The Food and Energy Security Act and the Heartland, Habitat, Harvest, and Horticulture Act; • The Heroes Earnings Assistance and Relief Tax Act; • The Housing and Economic Recovery Act; • The Emergency Economic Stabilization Act

  3. College Savings Plans • Effective for taxable year 2009 • Prepaid tuition plans or savings trust accounts will increase from $2,00 to $4,000 per plan or account • No restriction on individuals 70 or over

  4. Dealer disposition of Real Property • Effective for taxable year 2009, Senate Bill 978: • Virginia individuals and corporations • The sale occurs on or after January 1, 2009 • The property sold is real estate • The taxpayer reports the entire gain as income on the federal return

  5. Dealer disposition of Real Property • Allows the taxpayer to treat certain sales as installment sales for Virginia purpose

  6. Subtraction for Gain on Sales of Land Preservation Credit • Reconfirms existing law • Subtraction allowed to the extent that a gain is reported for federal purposes

  7. Limitation on Land Preservation Credit • Reduction from $100,000 per taxpayer to $50,000 per taxpayer for credits claimed for taxable years beginning on or after January 1, 2009, but before January 1, 2011. • Carryover period extended for the affected years

  8. Increase in Livable Home Tax Credit • The amount of the credit will be $2,000 for a new residence designed to improve accessibility • Or 50% of the cost, not to exceed $2,000, for retrofitting an existing residence to improve accessibility • Previously, the maximum amount of the credit was $1,000

  9. Personal Exemption • Effective 2008 $900 to $930 Remember: This does not apply to exemptions for age or blindness

  10. Mandatory Electronic Filing Requirements • Effective for taxable year 2008 • 100 or more clients must submit all returns electronically • Tax Preparer hardship waiver form 8454P

  11. Military Filing Extensions • Effective for taxable year 2008 • The due date for Virginia income tax extended until 90 days after the completion of the member’s non-combat deployment outside the United States

  12. UpcomingTax Changes

  13. Household Employers • Effective January 1, 2009 • Annual fling status for the household employer • Quarterly wages less than $5,000

  14. Digital Media • Effective July 1, 2009,Senate Bill 1421 • Businesses that provide lodging facilities in Virginia may be subject to collect the fee • The fee applies to digit media offered via an in-room television at a rate of 10%

  15. Virginia Motor Vehicle Fuel Sales Tax • Effective January 1, 2010, Senate Bill 1532 • Changes the tax on fuel sales • New tax rate is 2.1% • Distribution now liable, not retailers • Affects only certain localities

  16. Neighborhood Assistance Act Credit • House Bill 1790 expands credit provisions to include services provided by veterinarians

  17. PTE Withholding Reminder • Effective January 1, 2008 • PTE’s required to withhold tax on behalf of nonresident owners • ALL nonresident owners, not just individuals

  18. Get Square VA • Senate Bill 1120 • October 7 though December 5, 2009 • Pay the tax due plus one-half the interest

  19. Get Square VA You back taxes by the numbers • 50% How much of your interest charges will be waived if you pay what you owe during Get Square VA • 100% How much of your penalties will be waived if you pay what you owe during Get Square VA • 20% Amount you’ll be charged in penalties if you fail to pay what you owe during Get Square VA

  20. Get Square VA • At the conclusion, any remaining amnesty qualified tax liabilities will be assessed a 20% penalty. • More info www.GetSquareVA.com

  21. Handout Review

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