Bulletin Number
VTB 86-1
Tax Type
Individual Income Tax
Description
Individual Income Tax: Net Operating Losses
Topic
Taxable Income
Date Issued
01-01-1986
With the goal of increasing voluntary compliance and as part of our effort to provide regulations which interpret and enforce the laws of this Commonwealth, the Department of Taxation has adopted a regulation entitled VR 630-2-311.1: Individual Income Tax: Net Operating Losses. This regulation is an additional part of the Virginia Individual Income Tax Regulations that were published January 1, 1985.
This new regulation on Net Operating Losses was adopted on October 21, 1985 and is effective for taxable years beginning on and after January 1, 1985.
We have printed this regulation in a manner that will allow it to be inserted into the existing Virginia Individual Income Tax Regulations between pages 4 and 5.
EFFECTIVE DATE: Taxable years beginning on and after January 1, 1985.
EXPIRATION DATE: None
SUPERSEDES: All previous oral directives and written documents in conflict herewith.
REFERENCES: § 58.1-322 and 58.1-311, Code of Virginia
AUTHORITY: § 58.1-203, Code of Virginia
SCOPE: Applicable to all persons subject to the Virginia individual income tax.
SUMMARY: This original regulation details the Virginia tax treatment of federal net operating losses. Since there is no express statutory authority for a separate Virginia net operating loss, the amount of federal net operating loss is the starting point in computing the amount of deduction to be allowed on a Virginia return.
The amount of federal net operating loss shall be increased or decreased by an amount that equals the sum of the modifications required by the Code of Virginia in the loss year. This net amount of Virginia modification in the loss year is to be reported as a separate item and a proportionate share of its sum will follow the federal loss to the year in which the loss is utilized.
ADOPTION DATE: October 21, 1985
* * * [See Reg. 630-2-311.1 at } 18-040=18-040g, "Sales and Use' division, Vol. 1.]
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