Virginia Business Form Help
The following information has been provided to assist in the preparation of Virginia Business returns.
Form 500, Corporate Income Tax Return
Every corporation organized under the laws of Virginia, every foreign corporation registered with the State Corporation Commission for the privilege of doing business in Virginia, and every corporation having income from Virginia sources, aside from corporations that qualify for an exception, must (with the exceptions stated in these instructions) file a return through the Federal/State e-File program.
Schedule 500A, Multistate Corporation Allocation and Apportionment of Income
A corporation having income from business activity which is taxable both within and without Virginia must allocate and apportion its Virginia taxable income as provided in Va. Code §§ 58.1-407 through 58.1-420, § 58.1-422 or §58.1-422.1.
Select the appropriate apportionment method. If using the Motor Carrier Mileage Factor, Financial Corporation Cost of Performance Factor, Construction Corporation Completed Contract Basis Sales Factor or the Railway Company Revenue Car Miles, then enter the total amounts and Virginia amounts on the applicable line and the percentage will be calculated. If using any of the other factors, amounts have been pulled from the Multistate Allocation and Apportionment Information worksheet.
Schedule 500AB, Schedule of Related Entity Add Backs and Exceptions
Used to: (i) add back certain deductions that may be taken by a corporation on its federal return for interest, royalties, and other expenses related to intangible property such as trademarks and patents; (ii) report payments; and (iii) identify exceptions.
All information for Schedule 500AB must be entered on the worksheet linked to the line “Number of Related Entities”. For each related entity enter the name, FEIN, and gross revenues. After entering this information complete the Taxpayer’s Payments Made to Related Entity, Exception 1, Exception 2, and Exception 3 sections for each related entity when applicable.
Schedule 500ADJ, Schedule of Adjustments, is used to report additions to or to claim subtractions from federal taxable income and to claim withholding reported to a corporation by a pass-through entity on Virginia Schedule VK-1. Schedule 500ADJ is also used to compute the corrected tax liability for an amended Form 500.
If entering other additions or other subtractions, the codes and amounts must be entered on the worksheets provided. If using code 99, enter an explanation in the space provided.
Form 500C, Underpayment of Virginia Estimated Tax by Corporations, is used by corporations to determine whether they paid enough estimated tax, whether they are subject to the addition to the tax for underpayment of estimated tax, and, if so, the amount of the addition. Estimated tax is a corporation’s expected income tax liability minus its credits. A corporation must make estimated tax payments if it reasonably expects its tax liability to exceed $1,000.00 for such taxable year.
Schedule 500CR, Credit Computation Schedule, is used to claim both nonrefundable and refundable credits.
Schedule 500FED, Schedule of Federal Line Items, is used to report specific line items from the corporation’s federal income tax return.
Form 500NOLD, Corporation Application for Refund Carryback of Net Operating Loss
Form 500CP, Virginia Corporate Income Tax Automatic Extension Voucher, is a payment coupon that can be used only if you have an approved waiver from filing electronically. File Form 500CP to submit your payment by check or money order. You are allowed an automatic six-month extension of time to file your corporation income tax return. This provision does not extend the due date for payment of taxes; and you must pay at least 90% of your tax by the original due date for filing the return.
Form 500ES, Corporation Estimated Income Tax Payment Vouchers
Every corporation subject to state income taxation must make a declaration of estimated income tax for the taxable year if the corporation’s state income tax for the same period, reduced by the allowable tax credits, can be expected to exceed $1,000.
Form 502, Virginia Pass-Through Entity Return of Income and Return of Nonresident Withholding Tax
Schedule 502A, Multistate Pass-Through Entity, is used to show the amount of allocated income and to determine the apportionment percentage. If the pass-through entity’s income is all from Virginia, then the entity does not allocate and apportion income; the Virginia apportionment percentage is 100%, and Schedule 502A is not required. In all other cases, the pass-through entity must prepare a Schedule 502A and attach it to Form 502. The owners may also need a copy of Schedule 502A from the c in order to prepare their own returns properly.
Schedule 502ADJ, Pass-Through Entity Schedule of Adjustments, is used to report additions to or to claim subtractions from federal taxable income. Schedule 502ADJ is also used to compute the corrected tax liability for an amended Form 502.
If entering other additions or other subtractions, the codes and amounts must be entered on the worksheets provided. If using code 99, enter an explanation in the space provided.
Credits entered will flow to each owner’s Schedule VK-1.
When a pass-through entity is granted an approved waiver from filing electronically, due to hardship, the pass-through entity withholds and remits tax using a payment voucher, Form 502W, Pass-Through Entity Withholding Tax Payment. Form 502W is used to make a withholding payment prior to filing Form 502. This will occur most often when the pass-through entity utilizes the automatic extension to file. Form 502W can also be used to make a withholding payment prior to the due date. DO NOT enclose Form 502W with your Form 502. Instead, use Form 502V, payment voucher, to make payments with your return.
Schedule VK-1, Owner’s Share of Income and Virginia Modifications and Credits, is prepared by the pass-through entity to show each owner’s distributive or pro rata share of the entity’s income, Virginia modifications and Virginia credits, and other information necessary for an owner to be able to include the effect of participation in the entity in the owner’s income tax return. Schedule VK-1 does not replace federal Schedule K-1; it is a supplement to the federal schedule for those state tax issues that require additional information. The pass-through entity will prepare a Schedule VK-1 for each owner; a copy should be given to each owner, and a copy should be included with the entity’s Form 502 filed with the Department.
Checking this box will include this owner on Form 765, Unified Nonresident Individual Income Tax Return.
A partnership, S Corporation, LLC, or any other type of pass-through entity that transacts business in Virginia and has two or more nonresident individual owners may file a unified nonresident individual income tax return (unified return) on behalf of all of its qualified nonresident individual owners (participants) provided that certain conditions are met. In addition, certain estates and trusts which qualify and have income passed through to their nonresident beneficiaries may elect to file a unified return. These filers will complete Form 765, Unified Nonresident Individual Income Tax Return, in a similar manner as a pass-through entity filer. A unified return is an alternative to the filing of a nonresident individual income tax return by each nonresident individual owner of the pass-through entity.
Schedule CR, Virginia Credit Computation Schedule, is used to calculate credits claimed on Form 765, Unified Nonresident Individual Income Tax Return.
Total credit amounts should be entered on Schedule 502ADJ, Pass-Through Entity Schedule of Adjustments. These credits will then be passed through to each owner’s Schedule VK-1. For owners included in Form 765, each credit will carry to Schedule CR.
Schedule L, Unified Nonresident Income Tax Return List of Participants
Form 770IP, Automatic Fiduciary and Unified Nonresident Extension Payment, is a payment coupon and worksheet that provides taxpayers who are unable to file their Fiduciary or Unified Nonresident income tax return by May 1 (or due date of return for fiscal year filers) a means of calculating and remitting a payment to avoid penalty and interest.
Do not file Form 770IP if you determine that you do NOT owe additional tax, or if you make your extension payment electronically using VATAX Online for Individuals.
Form PAR 101, Virginia Power of Attorney and Declaration of Representative, is used to authorize an individual to represent you before the Virginia Department of Taxation. The individual you authorize should be registered as a Virginia Authorized Agent. A Virginia Authorized Agent is not required to be an enrolled agent. The Virginia Authorized Agent designation simply means that the individual has registered with the Virginia Department of Taxation as a representative for taxpayers. The authorized agent will be eligible to receive any correspondence, documentation, or other written materials that relate to specific tax matters for which the Virginia Power of Attorney and Declaration of Representative form has been filed.
Form 200, Virginia Litter Tax, is a tax imposed on every individual or entity who, on January 1 of the taxable year, was engaged in business as a manufacturer, wholesaler, distributor, or retailer of certain enumerated products.
Form VA-8879C, Virginia Corporation Income Tax e-file Signature Authorization, should be retained by the ERO. Do not send this form to the Virginia Department of Taxation orthe IRS.Complete Form VA-8879C when the Practitioner PINmethod is used or when the corporate officer authorizes the electronic return originator (ERO) to enter or generatethe corporate officer’s personal identification number (PIN) on the electronic corporation income tax return.
Form VA-8879P, Virginia Pass-Through Entity Return of Income and Return of Nonresident Withholding Tax e-file Signature Authorization, should be retained by the ERO. Do not send this form to the Virginia Department of Taxation orthe IRS.Complete Form VA-8879P when the Practitioner PINmethod is used or when the authorized representative authorizes the electronic return originator (ERO) to enter or generatethe corporate officer’s personal identification number (PIN) on the electronic pass-through entity tax return.