                                 CODE OF VIRGINIA

HEARING PROCEDURE (§ 58.1-526)

A. If a claimant agency other than the Internal Revenue Service receives written
application of the debtor&#8217;s intention to contest at a hearing the claim
upon which the intended setoff is based, it shall grant a hearing according to
procedures established by that agency under its operating statutes to determine
whether the claim is valid. Additionally, it shall be determined at the hearing
whether the claimed sum asserted as due and owing is correct, and if not, an
adjustment to the claim shall be made. A debtor of the Internal Revenue Service
shall contest the claim only in accordance with federal law and procedures.

B. Pending final determination at the hearing of the validity of the debt
asserted by the claimant agency, no action shall be taken in furtherance of
collection through the setoff procedure allowed under this article.

C. No person hearing the debtor&#8217;s application contesting the claimant
agency&#8217;s claim shall have been involved in the prior circumstances which
have culminated in such dispute.

D. No issue may be considered at the hearing which has been previously
litigated.

E. In the case of setoff arising out of delinquent local taxes, the scope of the
hearing shall be limited to determining whether the setoff is a tax obligation
that remains due and owing to the locality, and shall not address the underlying
basis of the tax obligation.

HISTORY: Code 1950, § 58-19.13; 1981, c. 408; 1982, c. 621; 1984, cc. 675, 720;
1996, cc. 363, 413; 1997, c. 496.