Income tax, corporate; filing status for tax returns of certain affiliated corporations.
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HB 224 — Income tax, corporate; filing status for tax returns of certain affiliated corporations.
Last action — Approved by Governor-Chapter 416 (effective 7/1/22)
No card. One bill, free forever — alerts when it moves.
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✓Introduced
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✓In Committee
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✓Passed House of Delegates
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✓Passed Senate
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✓To Executive
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6Enacted
This bill has been enacted into law. Introduced January 10, 2022. Enacted.
Signed by Governor Glenn Youngkin (Republican) on April 11, 2022.
Prognosis
Where this bill stands today.
Odds of enactment
HighHow often bills like it became law.
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Enacted
Current position in the legislative process.
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3 sponsors
1 primary, 2 co-sponsors signed on.
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Cleared a recorded vote
Passed 6 recorded votes so far.
Prognosis reads this bill's own signals — stage, sponsorship breadth, committee status, recorded votes and cross-state momentum. Odds come from a model trained on which bills have become law.
Summary
Corporate income tax returns of affiliated corporations. Provides that, for taxable years 2023 and 2024, certain affiliated corporations may elect to switch to or from consolidated corporate income tax return filing status under certain conditions, including the requirement that the affiliated group filed on the same basis for the preceding 20 years. The option would be available only to a group with at least one affiliate that is a bank exempt from filing a Virginia corporate income tax return. Current law requires a group of corporations to apply to the Tax Commissioner for permission to change the basis of the type of return filed and to meet certain specified requirements in order for permission to be granted. This bill is identical to SB 386.
Bill Text
What changed in the latest version
60 added · 58 removedPlain-language change summary
The recent amendments to Bill HB 224 clarify the filing options for affiliated corporations in Virginia regarding their income tax returns. Specifically, it makes it clear that these corporations can choose to file separately, combined, or consolidated returns and establishes that once a choice is made, all future returns must follow that same method unless they receive special permission to change. This change is important because it creates consistency and predictability for businesses in how they report their income and taxes, potentially simplifying the compliance process for many corporations.
SESSION ENROLLED VIRGINIA ACTS OF ASSEMBLY ––-- 2022 SESSION CHAPTER E416 An Act to amend and reenact § 58.1-442 of the Code of Virginia, relating to corporate income tax returns of affiliated corporations.
R O [H 224] Approved LApril L11, 2022 Be it enacted by the General Assembly of Virginia:
E § 58.1-442.
DA. file separate returns, file a combined return, or file a consolidated return of net income for the purpose of this chapter, and the taxes thereunder shall be computed and determined upon the basis of the type of return filed.
FollowingCorporations anwhich electionthat toare affiliated within the meaning of § 58.1-302 may, for any taxable year, file onseparate returns, file a separate,combined consolidated,return, or combinedfile basisa allconsolidated returnsreturn thereafterof filednet shallincome befor uponthe purpose of this chapter, and the sametaxes basisthereunder unlessshall permissionbe tocomputed changeand isdetermined grantedupon bythe basis of the Department.type of return filed.
B.Following an election to file on a separate, consolidated, or combined basis all returns theB.
For the purpose of subsection A:A:e basis unless permission to change is granted by the Department.
A consolidated return shall mean a single return for a group of corporations affiliated within the meaning of § 58.1-302, prepared in accordance with the principles of § 1502 of the Internal RevHnueRevenue Code and regulations promulgated thereunder.
Permission to file a consolidated return shall not2benot be denied to a group of affiliated corporations filing a consolidated federal return solely because two or more members of such affiliated group would be required to use different apportionment factors iftwoif or separate returns were filed.
corporation;ionablec. income or loss is computed, utilizing separate apportionment factors for each d.
Apportionable income or loss is computed, utilizing separate apportionment factors for each corporation;
d.
applicable,1. there would have been no decrease in tax liability computed under the proposed election as compared to the affiliated group's former filing method;
For the taxable year immediately preceding the taxable year for which the new election would be applicable, there would have been no decrease in tax liability computed under the proposed election as compared to the affiliated group's former filing method;
Notwithstanding subsections A and C, for taxable years beginning on and after January 1, 2023, but before January 1, 2025, a group of corporations may elect to change the basis of the type of return filed from combined to consolidated, if (i) such corporations are affiliated within the meaning of filed§ on58.1-302; the same basis for at least the preceding 20 years;
and(ii) (iii) on or before January 1, 2022, atas least one member of the affiliated group of which they are membersmembers, isas ait relatedhas entityexisted withinfrom thetime meaning of § 58.1-302 to atime, statehas orfiled nationalon bankthe thatsame isbasis exemptfor fromat filingleast athe Virginiapreceding corporate20 incomeyears; tax return under subdivision 3 of § 58.1-401.
and (iii) on or before January 1, 2022, at least one member of the affiliated group of which they are members is a related entity within the meaning of § 58.1-302 to a state or national bank that is exempt from filing a Virginia corporate income tax return under subdivision 3 of § 58.1-401.
A taxpayer shall provide notification to the Department of Taxation that an election pursuant to this subsection is being made.
of 2 E.
If any provision of subsection D is for any reason held to be invalid or unconstitutional by the decision of a court of competent jurisdiction, then that provision shall not be deemed severable, and all of 2 provisions of subsection D shall expire and be unavailable for any affiliated group that has not made the election as of the date of such decision.
View plain text versions (4)
- CHAP0416 View text Current pdf April 11, 2022
- HB224ER View text pdf March 07, 2022
- Engrossed Printed as engrossed 22101568D-E pdf February 10, 2022
- Prefiled Prefiled and ordered printed; offered 01/12/22 22101568D pdf January 10, 2022
Action History
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Approved by Governor-Chapter 416 (effective 7/1/22)
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Governor's Action Deadline 11:59 p.m., April 11, 2022
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Enrolled Bill communicated to Governor on March 22, 2022
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Signed by President
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Signed by Speaker
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Impact statement from TAX (HB224ER)
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Enrolled
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Passed Senate (40-Y 0-N)
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Read third time
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Constitutional reading dispensed (40-Y 0-N)
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Reported from Finance and Appropriations (14-Y 0-N)
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Impact statement from TAX (HB224E)
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Referred to Committee on Finance and Appropriations
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Constitutional reading dispensed
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VOTE: Passage (94-Y 4-N)
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Read third time and passed House (94-Y 4-N)
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Printed as engrossed 22101568D-E
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Engrossed by House as amended HB224E
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Committee amendment agreed to
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Read second time
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Read first time
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Reported from Finance with amendment(s) (21-Y 1-N)
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House committee, floor amendments and substitutes offered
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Subcommittee recommends reporting with amendments (9-Y 0-N)
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House subcommittee amendments and substitutes offered
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Impact statement from TAX (HB224)
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Assigned Finance sub: Subcommittee #1
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Referred to Committee on Finance
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Prefiled and ordered printed; offered 01/12/22 22101568D
Sponsors
- R. Lee Ware · Cosponsor
- Mark L. Keam · Cosponsor
- Carrie E. Coyner · Primary
Sponsorship breakdown
Export CSV (upgrade) →1 sponsors · 2 co-sponsors · 145 not signed on · 4 voted No
Sponsors (1)
Co-sponsors (2)
Not signed on (145)
145 members have not signed on to this bill.
Show all 145 →"Not signed on" means a member has not sponsored or co-sponsored this bill — it does not imply opposition. Members flagged Voted No have a recorded No vote on this bill.
Votes
| Party | Yea | Nay | Present | Not Voting |
|---|---|---|---|---|
| Unaffiliated | 40 | 0 | 0 | 0 |
| Total | 40 | 0 | 0 | 0 |
| % of votes cast | 100% | 0% | 0% | 0% |
How each member voted (40)
| Party | Yea | Nay | Present | Not Voting |
|---|---|---|---|---|
| Unaffiliated | 40 | 0 | 0 | 0 |
| Total | 40 | 0 | 0 | 0 |
| % of votes cast | 100% | 0% | 0% | 0% |
How each member voted (40)
| Party | Yea | Nay | Present | Not Voting |
|---|---|---|---|---|
| Unaffiliated | 14 | 0 | 0 | 0 |
| Total | 14 | 0 | 0 | 0 |
| % of votes cast | 100% | 0% | 0% | 0% |
How each member voted (14)
| Member | Party | Vote |
|---|---|---|
| McClellan, Jennifer L. | — | Yea |
| Barker, George L. | — | Yea |
| Ebbin, Adam P. | — | Yea |
| Edwards, John S. | — | Yea |
| Hanger, Emmett W., Jr. | — | Yea |
| Howell, Janet D. | — | Yea |
| L. Louise Lucas | — | Yea |
| Mamie E. Locke | — | Yea |
| Newman, Stephen D. | — | Yea |
| Petersen, J. Chapman | — | Yea |
| R. Creigh Deeds | — | Yea |
| Ruff, Frank M., Jr. | — | Yea |
| Saslaw, Richard L. | — | Yea |
| Vogel, Jill Holtzman | — | Yea |
| Party | Yea | Nay | Present | Not Voting |
|---|---|---|---|---|
| Unaffiliated | 93 | 4 | 0 | 2 |
| Total | 93 | 4 | 0 | 2 |
| % of votes cast | 94% | 4% | 0% | 2% |
How each member voted (99)
| Party | Yea | Nay | Present | Not Voting |
|---|---|---|---|---|
| Unaffiliated | 9 | 0 | 0 | 0 |
| Total | 9 | 0 | 0 | 0 |
| % of votes cast | 100% | 0% | 0% | 0% |
How each member voted (9)
| Member | Party | Vote |
|---|---|---|
| Byron, Kathy J. | — | Yea |
| Joseph P. McNamara | — | Yea |
| Mundon King, Candi | — | Yea |
| R. Lee Ware | — | Yea |
| Richard C. "Rip" Sullivan, Jr. | — | Yea |
| Robinson, Roxann L. | — | Yea |
| Tara A. Durant | — | Yea |
| Vivian E. Watts | — | Yea |
| Wendell S. Walker | — | Yea |
| Party | Yea | Nay | Present | Not Voting |
|---|---|---|---|---|
| Unaffiliated | 21 | 1 | 0 | 0 |
| Total | 21 | 1 | 0 | 0 |
| % of votes cast | 95% | 5% | 0% | 0% |
How each member voted (22)
| Member | Party | Vote |
|---|---|---|
| Bill Wiley | — | Yea |
| Byron, Kathy J. | — | Yea |
| Campbell, Ronnie R. | — | Yea |
| Chris S. Runion | — | Yea |
| Don Scott | — | Yea |
| Elizabeth B. Bennett-Parker | — | Yea |
| Fowler, Hyland F."Buddy," Jr. | — | Yea |
| Freitas, Nicholas J. | — | Yea |
| Hudson, Sally L. | — | Nay |
| Joseph P. McNamara | — | Yea |
| Keam, Mark L. | — | Yea |
| Marcus B. Simon | — | Yea |
| Mundon King, Candi | — | Yea |
| Murphy, Kathleen | — | Yea |
| Orrock, Robert D., Sr. | — | Yea |
| R. Lee Ware | — | Yea |
| Richard C. "Rip" Sullivan, Jr. | — | Yea |
| Robinson, Roxann L. | — | Yea |
| Rodney T. Willett | — | Yea |
| Tara A. Durant | — | Yea |
| Vivian E. Watts | — | Yea |
| Wendell S. Walker | — | Yea |
Subjects
Frequently asked questions
- What does HB 224 do?
- Corporate income tax returns of affiliated corporations. Provides that, for taxable years 2023 and 2024, certain affiliated corporations may elect to switch to or from consolidated corporate income tax return filing status under certain conditions, including the requirement that the affiliated group filed on the same basis for the preceding 20 years. The option would be available only to a group with at least one affiliate that is a bank exempt from filing a Virginia corporate income tax return. Current law requires a group of corporations to apply to the Tax Commissioner for permission to change the basis of the type of return filed and to meet certain specified requirements in order for permission to be granted. This bill is identical to SB 386.
- Who sponsors HB 224?
- HB 224 is sponsored by R. Lee Ware, Keam, Mark L., and Coyner, Carrie E..
- What is the current status of HB 224?
- This bill has been enacted into law. Introduced January 10, 2022. Enacted.
- Where can I track HB 224?
- Track HB 224 free on One Click Politics — get push/email alerts when it moves.
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