                                 CODE OF VIRGINIA

BAD DEBTS (§ 58.1-621)

A. In any return filed under the provisions of this chapter, the dealer may
credit, against the tax shown to be due on the return, the amount of sales or
use tax previously returned and paid on accounts which are owed to the dealer
and which have been found to be worthless within the period covered by the
return. The credit, however, shall not exceed the amount of the uncollected
sales price determined by treating prior payments on each debt as consisting of
the same proportion of sales price, sales tax and other nontaxable charges as in
the total debt originally owed to the dealer. The amount of accounts for which a
credit has been taken that are thereafter in whole or in part paid to the dealer
shall be included in the first return filed after such collection.

B. Notwithstanding any other provision of this section, a dealer whose volume
and character of uncollectible accounts, including checks returned for
insufficient funds, renders it impractical to substantiate the credit on an
account-by-account basis, may, subject to the approval of the Department,
utilize an alternative method of substantiating the credit.

HISTORY: Code 1950, § 58-441.24; 1966, c. 151; 1974, c. 202; 1984, c. 675;
2005, c. 355.