Virginia – Interest on Refunds

SALT Report 1890 – The Virginia State Legislature pre-filed a bill, HB 1329, that authorizes localities not to pay interest on refunds of local taxes when the refund is due to errors made by the taxpayer.

Section 58.1-3916 Counties, cities, and towns may provide dates for filing returns, set penalties, interest, etc

A locality that provides for payment of interest on delinquent taxes shall provide for interest at the same rate on overpayments due to erroneously assessed taxes to be paid to the taxpayer, provided that no interest shall be required to be paid on such refund if:

(i)  The amount of the refund is $10 or less,

(ii)  The refund is the result of proration pursuant to Section 58.1-3516, or

(iii)  The erroneous assessment is based on erroneous information submitted by the taxpayer to the assessing official

Section 58.1-3918 Interest on taxes not paid by following day

(iii) The erroneous assessment is based on erroneous information submitted by the taxpayer to the assessing official. Interest for failure to file a return or to pay a tax shall not be imposed on the taxpayer if such failure was not the fault of the taxpayer, or was the fault of the commissioner of revenue or the treasurer, as the case may be.

For Further Information:

Virginia State Legislature – HB 1329