Bulletin Number
VTB 00-1
Tax Type
General Provisions
Description
Interest Rates; Second Quarter 2000
Topic
Basis of Tax
Date Issued
03-28-2000
INTEREST RATES
SECOND QUARTER 2000
SECOND QUARTER 2000
Changes to Virginia Interest Rates: In 1999, the General Assembly enacted legislation to equalize Virginia's interest rates on most tax overpayments (refunds) and underpayments (assessments) for both corporate and noncorporate taxpayers. Effective beginning on January 1, 2000, Virginia's overpayment rate for all overpayments is now equal to the federal overpayment rate for noncorporate taxpayers plus 2% under this change. However, the interest rate on "large corporate underpayments," remains unchanged and is equal to the federal rate for large corporate underpayments plus 2%.
Federal rates changed: State and certain local interest rates are subject to change every quarter based on changes in federal rates established pursuant to I.R.C. § 6621. The federal rates for the second quarter of 2000 increase to 9% for tax underpayments (assessments), 9% for tax overpayments (refunds) by taxpayers other than corporations, and 11% for "large corporate underpayments" as defined in I.R.C. § 6621(c). Code of Virginia 21 58.1-15 provides that the underpayment rates for Virginia taxes will be 2% higher than the corresponding federal rates and overpayment rates for Virginia taxes will be 2% higher than the federal rate for noncorporate taxpayers. Accordingly, the Virginia rates for the second quarter of 2000 will be 11% for tax underpayments (assessments), 11% for tax overpayments (refunds), and 13% for "large corporate underpayments."
Rate for Addition to Tax for Underpayments of Estimated Tax
Taxpayers with taxable years ending on March 31, 2000: Tax returns are due on July 17,2000. For the purpose of computing the addition to the tax for underpayment of Virginia estimated income taxes on Form 760C (for individuals, estates and trusts), Form 760F (for farmers and fishermen) or on Form 500C, the second quarter 11% underpayment rate will apply through the due date of the return, July 17, 2000, (for corporations), and August 1, 2000, (for individuals and fiduciaries).
Individuals whose taxable years ends on December 31, 1999: Tax returns for the calendar year 1999 are due on May 1, 2000. For the purpose of computing the addition to the tax for underpayment of Virginia estimated income taxes on Form 760C (for individuals, estates and trusts) or Form 760F (for farmers and fishermen), the first quarter 10% underpayment rate will apply through the due date of the return, May 1, 2000.
Corporations with taxable years ending on December 31, 1999: Tax returns for the calendar year 1999 are due on April 17, 2000. For the purpose of computing the addition to the tax for underpayment of Virginia estimated income taxes on Form 500C, the first quarter 10% underpayment rate will apply through the due date of the return, April 17, 2000.
Local Tax
Assessments: Localities that assess interest on delinquent taxes under Code of Virginia § 58.1-3916 may impose interest at a rate not to exceed 10% for the first year of delinquency, and at a rate not to exceed 10% or the federal underpayment rate in effect for the applicable quarter, whichever is greater, for the second and subsequent years of delinquency. For the second quarter of 2000, the federal underpayment rate is 9%.
Refunds: Effective July 1, 1999, localities which charge interest on delinquent taxes are required paying interest to taxpayers on all overpayments or erroneously assessed taxes at the same rate as they charge interest on delinquent taxes under Code of Virginia § 58.1-3916.
Recent Interest Rates
Non -
Corporation Corporation Large
Accrual Period Overpayment Overpayment Underpayment Corporate
Beginning Through (Refund) (Refund) (Assessment) Underpayment
l-Oct-89 31-Mar-91 10% 10% 11% ----
1-Apr-91 30-Jun-91 9% 9% 10% ----
1-Jul-91 31-Dec-91 9% 9% 12% 14%
1-Jan-92 31-Mar-92 8% 8% 11% 13%
1-Apr-92 30-Sep-92 7% 7% 10% 12%
1-Oct-92 30-Jun-94 6% 6% 9% 11%
1-Jul-94 30-Sep-94 7% 7% 10% 12%
1-Oct-94 31-Mar-95 8% 8% 11% 13%
1-Apr-95 30-Jun-95 9% 9% 12% 14%
1-Jul-95 31-Mar-96 8% 8% 11% 13%
1-Apr-96 30-Jun-96 7% 7% 10% 12%
1-Jul-96 31-Mar-98 8% 8% 11% 13%
1-Apr-98 31-Dec-98 7% 7% 10% 12%
1-Jan-99 31-Mar-99 7% 6% 9% 11%
1-Apr-99 31-Dec-99 8% 7% 10% 12%
1-Jan-00 31-Mar-00 10% 10% 10% 12%
1-Apr-00 30-Jun-00 11% 11% 11% 13%
For additional information: Contact the Office of Customer Services, Virginia Department of Taxation, P. O. Box 1115, Richmond, Virginia 23218-1115, or call the following numbers for additional information about interest rates and penalties.
Individual & Fiduciary Income Tax (804) 367-8031
Corporation Income Tax (804) 367-8037
Withholding Tax (804) 367-8037
Soft Drink Excise Tax (804) 367-8098
Aircraft Sales & Use Tax (804) 367-8098
Other Sales & Use Taxes (804) 367-8037
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