Virginia Waives Interest for Certain Income and Sales Tax if Paid by June 1
The Virginia Department of Taxation previously announced that any Virginia individual, corporate or fiduciary income tax payments due from April 1, 2020, to June 1, 2020, are now due on June 1. Originally it was noted that while no penalties would be assessed against payments made by June 1, interest would still accrue.
Recently, the Virginia General Assembly enacted a bill that provided for the waiver of interest for certain Virginia income and sales tax payments that are paid by June 1.
Interest will be waived only if full payment is made on or before June 1 for payments made with individual, corporate, or fiduciary 2019 income tax returns, as well as payments required to be made with respect to an election to file on extension. Interest will also be waived for the first estimated income tax payment for 2020. This relief is automatic and no application or paperwork is required to qualify.
Additionally, dealers that were granted an extension of the due date for the February 2020 sales tax return and payment due in March will receive a waiver of the interest that would have otherwise accrued for such late payment. This waiver of interest only applies to such payments submitted by April 20, 2020.
There are distinct advantages to starting your tax return preparation process now if you have not already done so, including the acceleration of any current-year refunds you may be due. Furthermore, recently enacted federal legislation has created significant tax planning opportunities to amend prior year returns for additional refunds as well as reduce current year taxes. Most of these tax planning opportunities require significant analysis and many require separate studies. We strongly encourage you to start now.
Cherry Bekaert remains committed to providing you a superior client experience. We continue to work hard and creatively to meet your tax return needs and encourage you to submit your tax information to us as early as you can.