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Virginia Administrative Code (Last Updated: January 10, 2017) |
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Title 23. Taxation |
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Agency 10. Department of Taxation |
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Chapter 115. Fiduciary Income Tax |
Section 162. Period of underpayment
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The period of the underpayment shall run from the date the installment was required to be paid to the earlier of the following dates:
1. May 1, if a calendar year, or the 15th day of the fourth month following the close of the taxable year, if a fiscal year, or
2. With respect to any portion of the underpayment, the date on which such portion is paid. For purposes of this subdivision, a payment of estimated tax on any installment date shall be considered a payment of any previous underpayment only to the extent such payment exceeds the amount of the installment determined under subdivision 1 of 23VAC10-115-161 for such installment date.
3. Example: The principles of 23VAC10-115-160, 23VAC10-115-161, and 23VAC10-115-162 may be illustrated by the following: On or before May 1, 1988, the trustee of The Jones Trust could reasonably expect the fiduciary's Virginia tax liability for calendar year 1988 to exceed $150. Therefore, the trustee timely makes four installment payments: $1,500 on May 1, 1988, and June 15, 1988, and $2,000 on September 15, 1988, and January 15, 1989. When the fiduciary income tax return is filed on May 1, 1989, the tax liability is $10,000. The total paid ($7,000) is less than 90% of the tax ($9,000). Therefore, an addition to the tax in the amount of $174.56 is due, computed as follows:
INSTALLMENT 1st 2nd 3rd 4th
AMOUNT OF UNDERPAYMENT
90% of the tax / 4 2,250.00 2,250.00 2,250.00 2,250.00
Actual Payment 1,500.00 1,500.00 2,000.00 2,000.00
Underpayment 750.00 750.00 250.00 250.00
PERIOD OF UNDERPAYMENT
Date due 5/1/88 6/15/88 9/15/88 1/15/89
Date Paid 5/1/89 5/1/89 5/1/89 5/1/89
No. of days (total) 365 320 228 106
No. of days underpayment is
subject to each rate
4/1/88 - 6/30/88 at 10% 60 15 0 0
7/1/88 - 9/30/88 at 10% 92 92 15 0
10/1/88 - 12/31/88 at 11% 92 92 92 0
1/1/89 - 5/1/89 at 11% 121 121 121 106
ADDITION TO THE TAX
4/1/88 - 6/30/88 at 10% 12.33 3.08 0.00 0.00
7/1/88 - 9/30/88 at 10% 18.90 18.90 1.03 0.00
10/1/88 - 12/31/88 at 11% 20.79 20.79 6.93 0.00
1/1/89 - 5/1/89 at 11% 27.35 27.35 9.12 7.99
Total addition = 174.56 79.37 70.12 17.08 7.99
Historical Notes
Derived from VR630-5-492 § 3, eff. February 2, 1989.