Tax Type
General Provisions
Description
Accrual of interest while §58.1118 application pending
Topic
Collection of Delinquent Tax
Penalties and Interest
Date Issued
02-29-1984
February 29, 1984
Re: Accrual of Interest While §58-1118 Application Pending
Dear****************
This responds to your letter of January 30, 1984 requesting abatement of the assessment of additional interest of $**** which accrued from March 11, 1983, the date of assessment, to November 14, 1983, the date when partial payment of the taxes, penalties and interest was made. The State Tax Commissioner denied your application for correction by letter dated October 24, 1983. A staff member of the Tax Policy Division has spoken with you in regards to the validity of the assessment of interest that accrued during the time that your application for correction was being considered. You have requested that we document for you this information.
§58-1118, Code of Virginia, does not stop the accrual of interest while the department is considering the merits of an application for correction under that section, nor does it impose any time restraint on the department's response to the application. The taxpayer may, of course, pay the assessment upon filing the application for correction and thus prevent the accrual of additional interest.
You have also inquired as to whether the department would have refunded the taxpayer all amounts paid plus accrued interest, if the application for correction had been granted and if the taxpayer had paid the assessment upon filing the application. §58-1140.1, concerning interest on overpayments provides, in part, that "any tax refunded ... as a result of an erroneous assessment shall bear interest from the date the assessment was paid."
I hope that we have sufficiently answered your inquiry and that the balance of the assessment for sales and use taxes for November 1979 through July 1982 will be forthcoming.
Sincerely,
W. H. Forst
Tax Commissioner
Rulings of the Tax Commissioner