Administrative Code

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Virginia Administrative Code
Title 23. Taxation
Agency 10. Department Of Taxation
Chapter 110. Individual Income Tax
10/18/2021

23VAC10-110-60. Refund of overpayment.

A. Generally. If the amount of tax paid by any individual exceeds that which is actually due, the overpayment shall be refunded to the taxpayer or, at the taxpayer's request, credited against his tax liability for the next succeeding taxable year.

B. Set-off debt collection.

1. Generally. Pursuant to the provisions of the Set-Off-Debt Collection Act (§ 58.1-520 et seq. of the Code of Virginia) the tax refund of any individual may be used in whole or in part to set off any delinquent debt owed by the taxpayer to a claimant agency as defined in § 58.1-520 of the Code of Virginia, which includes all state agencies, local governments, and the Supreme Court. The determination of whether a refund set-off is proper and the resolution of questions concerning a set-off must be addressed to the claimant agency and not the Department of Taxation.

2. Amended returns. Any portion of a tax refund which has been transmitted to a claimant agency pursuant to a final debt set-off is deemed to have been paid to the taxpayer. Therefore, if an amended return is filed relative to an overpayment of tax which has been transmitted to a claimant agency, only that portion in excess of the amount transmitted shall be refunded. If an amended return shows a lesser overpayment than that on the original return and such prior refund amount has been transmitted to a claimant agency, the taxpayer will be liable for payment to the department for the difference between the original overpayment and the amount shown on the amended return, as though the original refund had been made directly to the taxpayer.

A husband and wife who file separately on a combined return and who, after notification that all or a portion of the refund resulting from such return has been set-off to satisfy a delinquent debt claim, file an amended return which results in a shift in the refund interest from one spouse to the other shall be deemed to have fraudulently conveyed interest in the refund and such amended returns shall not be accepted unless the result is an overall increased refund. (For additional information, see Set-Off Debt Collection Act Regulations, Chapter 380 of Title 23 of the Virginia Administrative Code.)

C. Interest on refunds.

1. Generally. The payment of interest on refunds of tax overpayments shall be controlled by the provisions of § 58.1-1833 of the Code of Virginia.

2. Withholding and estimated tax. Tax withheld by an employer pursuant to the provisions of § 58.1-460 et seq. of the Code of Virginia and any amount paid as estimated tax is deemed to be paid when the income tax return for the taxable year is filed or on the due date of the return, whichever is later.

3. Net operating loss and net capital loss. Any overpayment of tax attributable to the carry-back to a preceding taxable year of any net operating loss or net capital loss shall be deemed to be made on the day on which the return for the year in which the loss occurred was filed, or the last day prescribed by law for such filing, whichever is later. (See also 23VAC10-20-200 and 23VAC10-110-320.)

Statutory Authority

§§ 58.1-203 and 58.1-309 of the Code of Virginia.

Historical Notes

Derived from VR630-2-309; adopted September 19, 1984; revised eff. January 1, 1985 with retroactive effect according to Va. Code § 58-48.6 (recodified as Section 58.1-203).

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