                                 CODE OF VIRGINIA

DEFINITIONS (§ 58.1-302)

For the purpose of this chapter and unless otherwise required by the context:
		&#8220;Affiliated&#8221; means two or more corporations subject to Virginia
income taxes whose relationship to each other is such that (i) one corporation
owns at least 80 percent of the voting stock of the other or others or (ii) at
least 80 percent of the voting stock of two or more corporations is owned by the
same interests.
		&#8220;Compensation&#8221; means wages, salaries, commissions and any other
form of remuneration paid or accrued to employees for personal services.
		&#8220;Corporation&#8221; includes associations, joint stock companies and
insurance companies.
		&#8220;Domicile&#8221; means the permanent place of residence of a taxpayer
and the place to which he intends to return even though he may actually reside
elsewhere. In determining domicile, consideration may be given to the
applicant&#8217;s expressed intent, conduct, and all attendant circumstances
including, but not limited to, financial independence, business pursuits,
employment, income sources, residence for federal income tax purposes, marital
status, residence of parents, spouse and children, if any, leasehold, sites of
personal and real property owned by the applicant, motor vehicle and other
personal property registration, residence for purposes of voting as proven by
registration to vote, if any, and such other factors as may reasonably be deemed
necessary to determine the person&#8217;s domicile.
		&#8220;Foreign source income&#8221; means:

1. Interest, other than interest derived from sources within the United States;

2. Dividends, other than dividends derived from sources within the United
States;

3. Rents, royalties, license, and technical fees from property located or
services performed without the United States or from any interest in such
property, including rents, royalties, or fees for the use of or the privilege of
using without the United States any patents, copyrights, secret processes and
formulas, good will, trademarks, trade brands, franchises, and other like
properties;

4. Gains, profits, or other income from the sale of intangible or real property
located without the United States; and

5. The amount of an individual&#8217;s share of net income attributable to a
foreign source qualified business unit of an electing small business corporation
(S corporation). For purposes of this subsection, qualified business unit shall
be defined by &#xA7; 989 of the Internal Revenue Code, and the source of such
income shall be determined in accordance with &#xA7;&#xA7; 861, 862 and 987 of
the Internal Revenue Code.
			In determining the source of &#8220;foreign source income,&#8221; the
provisions of &#xA7;&#xA7; 861, 862, and 863 of the Internal Revenue Code shall
be applied except as specifically provided in subsection 5 above.
			&#8220;Income and deductions from Virginia sources&#8221; includes:

1. Items of income, gain, loss and deduction attributable to:
			a. The ownership of any interest in real or tangible personal property in
Virginia;
			b. A business, trade, profession or occupation carried on in Virginia; or
			c. Prizes paid by the Virginia Lottery Department, and gambling winnings from
wagers placed or paid at a location in Virginia.

2. Income from intangible personal property, including annuities, dividends,
interest, royalties and gains from the disposition of intangible personal
property to the extent that such income is from property employed by the
taxpayer in a business, trade, profession, or occupation carried on in Virginia.
			&#8220;Income tax return preparer&#8221; means any person who prepares for
compensation, or who employs one or more persons to prepare for compensation,
any return of tax imposed by this chapter or any claim for refund of tax. For
purposes of the preceding sentence, the preparation for compensation of any
portion of a return or claim for refund shall be treated as if it were the
preparation of the return or claim for refund. A person shall not be an
&#8220;income tax return preparer&#8221; merely because the person:

1. Furnishes typing, reproducing, or other mechanical assistance;

2. Prepares a return or claim for refund of the employer (or of an officer or
employee of the employer) by whom he is regularly and continuously employed;

3. Prepares as a fiduciary a return or claim for refund for any person; or

4. Prepares an application for correction of an erroneous assessment or a
protective claim for refund for a taxpayer in response to any assessment
pursuant to &#xA7; 58.1-1812 issued to the taxpayer or in response to any waiver
pursuant to &#xA7; 58.1-101 or 58.1-220 after the commencement of an audit of
the taxpayer or another taxpayer if a determination in such audit of such other
taxpayer directly or indirectly affects the tax liability of such taxpayer.
			&#8220;Individual&#8221; means all natural persons whether married or
unmarried and fiduciaries acting for natural persons, but not fiduciaries acting
for trusts or estates.
			&#8220;Intangible expenses and costs&#8221; means:

1. Expenses, losses and costs for, related to, or in connection directly or
indirectly with the direct or indirect acquisition, use, maintenance or
management, ownership, sale, exchange, lease, transfer, or any other disposition
of intangible property to the extent such amounts are allowed as deductions or
costs in determining taxable income;

2. Losses related to or incurred in connection directly or indirectly with
factoring transactions or discounting transactions;

3. Royalty, patent, technical and copyright fees;

4. Licensing fees; and

5. Other similar expenses and costs.
			&#8220;Intangible property&#8221; means patents, patent applications, trade
names, trademarks, service marks, copyrights and similar types of intangible
assets.
			&#8220;Interest expenses and costs&#8221; means amounts directly or
indirectly allowed as deductions under &#xA7; 163 of the Internal Revenue Code
for purposes of determining taxable income under the Internal Revenue Code to
the extent such expenses and costs are directly or indirectly for, related to,
or in connection with the direct or indirect acquisition, use, maintenance,
management, ownership, sale, exchange, lease, transfer, or disposition of
intangible property.
			&#8220;Nonresident estate or trust&#8221; means an estate or trust which is
not a resident estate or trust.
			&#8220;Related entity&#8221; means:

1. A stockholder who is an individual, or a member of the stockholder&#8217;s
family enumerated in &#xA7; 318 of the Internal Revenue Code, if the stockholder
and the members of the stockholder&#8217;s family own, directly, indirectly,
beneficially or constructively, in the aggregate, at least 50 percent of the
value of the taxpayer&#8217;s outstanding stock;

2. A stockholder, or a stockholder&#8217;s partnership, limited liability
company, estate, trust or corporation, if the stockholder and the
stockholder&#8217;s partnerships, limited liability companies, estates, trusts
and corporations own directly, indirectly, beneficially or constructively, in
the aggregate, at least 50 percent of the value of the taxpayer&#8217;s
outstanding stock; or

3. A corporation, or a party related to the corporation in a manner that would
require an attribution of stock from the corporation to the party or from the
party to the corporation under the attribution rules of &#xA7; 318 of the
Internal Revenue Code, if the taxpayer owns, directly, indirectly, beneficially
or constructively, at least 50 percent of the value of the corporation&#8217;s
outstanding stock. The attribution rules of &#xA7; 318 of the Internal Revenue
Code shall apply for purposes of determining whether the ownership requirements
of this subdivision have been met.
			&#8220;Related member&#8221; means a person that, with respect to the
taxpayer during all or any portion of the taxable year, is a related entity, a
component member as defined in &#xA7; 1563(b) of the Internal Revenue Code, or
is a person to or from whom there is attribution of stock ownership in
accordance with &#xA7; 1563(e) of the Internal Revenue Code.
			&#8220;Resident&#8221; applies only to natural persons and includes, for the
purpose of determining liability for the taxes imposed by this chapter upon the
income of any taxable year every person domiciled in Virginia at any time during
the taxable year and every other person who, for an aggregate of more than 183
days of the taxable year, maintained his place of abode within Virginia, whether
domiciled in Virginia or not. The word &#8220;resident&#8221; shall not include
any member of the United States Congress who is domiciled in another state.
			&#8220;Resident estate or trust&#8221; means:

1. The estate of a decedent who at his death was domiciled in the Commonwealth;

2. A trust created by will of a decedent who at his death was domiciled in the
Commonwealth; or

3. A trust created by or consisting of property of a person domiciled in the
Commonwealth.
			&#8220;Sales&#8221; means all gross receipts of the corporation not allocated
under &#xA7; 58.1-407, except the sale or other disposition of intangible
property shall include only the net gain realized from the transaction.
			&#8220;State,&#8221; for purposes of Article 10 (&#xA7; 58.1-400 et seq.),
means any state of the United States, the District of Columbia, the Commonwealth
of Puerto Rico, any territory or possession of the United States, and any
foreign country.
			&#8220;Trust&#8221; or &#8220;estate&#8221; means a trust or estate, or a
fiduciary thereof, which is required to file a fiduciary income tax return under
the laws of the United States.
			&#8220;Virginia fiduciary adjustment&#8221; means the net amount of the
applicable modifications described in &#xA7;&#xA7; 58.1-322.01, 58.1-322.02, and
58.1-322.04 (including subdivision 1 of &#xA7; 58.1-322.04 if the estate or
trust is a beneficiary of another estate or trust) which relate to items of
income, gain, loss or deduction of an estate or trust. The fiduciary adjustment
shall not include the modification in &#xA7; 58.1-322.03, except that the amount
of state income taxes excluded from federal taxable income shall be included.
The fiduciary adjustment shall also include the modification in subdivision 7 of
&#xA7; 58.1-322.03 regarding the deduction for the purchase of a prepaid tuition
contract or contribution to a savings trust account.

HISTORY: Code 1950, §§ 58-151.02, 58-151.013, 58-151.023, 58-151.034,
58-151.081; 1971, Ex. Sess., c. 171; 1972, cc. 310, 827; 1973, cc. 198, 345,
458; 1974, c. 682; 1975, c. 46; 1976, cc. 528, 694, 781; 1977, cc. 297, 612;
1978, cc. 67, 158; 1979, cc. 226, 404, 596; 1981, cc. 402, 414; 1982, c. 633;
1983, cc. 452, 472; 1984, cc. 153, 162, 636, 674, 675, 729; 1990, c. 294; 1992,
c. 678; 1995, c. 602; 2000, cc. 382, 400; 2004, Sp. Sess. I, c. 3; 2005, c. 48;
2017, c. 444; 2019, cc. 23, 192.