Administration: Refund - Statute of Limitations
June 7, 2023
Re: § 58.1-1821 Application: Individual Income Tax
Dear *****:
This will respond to your letter in which you seek a refund of individual income tax paid by ***** (the “Taxpayer”) for the taxable year ended December 31, 2017. The Taxpayer also seeks correction of an assessment of individual income tax issued to him for the taxable year ended December 31, 2018.
FACTS
The Taxpayer filed a Virginia resident income tax return for the 2017 taxable year and paid the tax shown as due in April 2018. The Taxpayer did not, however, file a return for the 2018 taxable year. The Department subsequently received information from the Internal Revenue Service (IRS) indicating that the Taxpayer may have been required to file a Virginia income tax return for the 2018 taxable year. A review of the Department’s records showed that the Taxpayer had not filed a return. The Department requested additional information from the Taxpayer in order to determine if his income was taxable in Virginia. When a response was not received, the Department issued an assessment.
The Taxpayer paid the assessment and appealed, contending he was a resident of ***** (State A). The Taxpayer sought refunds for the tax paid for both the 2017 and 2018 taxable years. Based on the information provided with the appeal, the Department abated the assessment for the 2018 taxable year and refunded the Taxpayer’s payment. The Department, however, did not issue a refund for the 2017 taxable year. This determination, therefore, will be limited to addressing the refund requested for the 2017 taxable year.
DETERMINATION
Virginia Code § 58.1-499 A provides that, in the case of any overpayment of any tax, whether by reason of excessive withholding, overestimating and overpaying estimated tax, or error on the part of the taxpayer, the Department shall order a refund of the overpayment. Virginia Code § 58.1-499 D specifies, however, in pertinent part that:
No refund under this section shall be made whether on discovery by the Department or on written application of the taxpayer, if such discovery is not made or such written application is not received within three years from the last day prescribed by law for the timely filing of the return [Emphasis added.]
Virginia Code § 58.1-341 A requires that taxpayers file individual income tax returns by May 1 of the year following the tax year for which the return is filed. Accordingly, the Taxpayer had three years from the original due date, May 1, 2018, in which to file a timely request for refund. The statute of limitations for claiming a refund for the 2017 taxable year expired the day after May 3, 2021 (May 1, 2021, was a Saturday). The Taxpayer’s appeal was filed in September 2022, after the statute of limitations had expired. Further, it does not appear that the Taxpayer requested a refund of the tax paid for the 2017 taxable year at any other time on or before May 3, 2021. Therefore, the request for a refund of the overpayment of Virginia income tax for the taxable year ended December 31, 2017, cannot be granted.
The Code of Virginia sections cited are available online at www.tax.virginia.gov in the Laws, Rules, & Decisions section of the Department’s website. If you have any questions regarding this determination, you may contact ***** in the Office of Tax Policy, Appeals and Rulings, at (804) *****.
Sincerely,
Craig M. Burns
Tax Commissioner
AR/4326.X