                                 CODE OF VIRGINIA

DELINQUENT RETURNS; ENFORCEMENT; WHEN APPROVAL REQUIRED (§ 58.1-1802.2)

A. For purposes of this section, &#8220;willfully&#8221; means voluntarily,
knowingly, and intentionally violating a legal duty.
			Taxpayers failing to file tax returns due pursuant to Chapter 3 (&#xA7;
58.1-300 et seq.) shall be requested to prepare and file all such returns except
in instances where there is an indication that the taxpayer willfully failed to
file the required return or returns, or if there is any other indication of
fraud. All delinquent returns submitted by a taxpayer, whether upon his own
initiative or at the request of the Department, shall be enforced pursuant to
the provisions of subsection C and shall be accepted. However, when an
indication that the taxpayer willfully failed to file the required return or if
any other indication of fraud exists, the Department may refuse to accept such
delinquent return submission in accordance with the laws of the Commonwealth and
guidelines developed pursuant to this section.

B. Where it is determined that required returns have not been filed when due,
the extent to which compliance for prior years will be enforced shall be
determined by reference to factors ensuring compliance and proper administration
of staffing and other Department resources. Factors to be considered shall
include, but are not limited to, the taxpayer&#8217;s prior history of
noncompliance, existence of income from illegal sources, effects upon voluntary
compliance, anticipated revenue, and collectability, in relation to the time and
effort required to determine tax due. The Department shall also consider any
special circumstances existing in the case of a particular taxpayer, class of
taxpayer, or industry, or which may be peculiar to the class of tax involved.

C. Subject to the provisions of subsection A, application of the criteria in
subsection B shall result in enforcement by the Department of delinquency
procedures for not more than six years of the taxpayer&#8217;s returns.
Enforcement beyond such period shall not be undertaken without prior approval of
the applicable manager designated by the Tax Commissioner. However, the approval
of such manager shall not be required if the nonfiling taxpayer voluntarily
files returns beyond the established enforcement period. Such approval shall
reference the facts of the taxpayer&#8217;s case and detail the reasons why
enforcement for the longer period is recommended.

D. The Department shall develop guidelines for the enforcement procedures
provided by this section. Such guidelines shall be exempt from the provisions of
the Administrative Process Act (&#xA7; 2.2-4000 et seq.).

HISTORY: 2021, Sp. Sess. I, c. 413.