SB 1182 — Bank franchise tax; electronic access to banks for real estate assessment records, etc.

SESSION ENROLLED VIRGINIA ACTS OF ASSEMBLY ––-- 2023 SESSION CHAPTER E51 An Act to amend and reenact §§ 58.1-1206, 58.1-1207, and 58.1-1212 of the Code of Virginia, relating to bank franchise tax.

R O [S 1182] Approved LMarch L17, 2023 Be it enacted by the General Assembly of Virginia:

That §§ 58.1-1206, 58.1-1207, and 58.1-1212 of the Code of Virginia are amended and reenacteEreenacted as follows:

D§ A.58.1-1206.

Deductions from gross capital.

A.

The assessed value of real estate if otherwise taxed in this the Commonwealth which is owned by such bank, or is used or occupied by such bank, if held in the name of a majority-owned subsidiary of the bank or of a bank holding company which owns a majority of the capital stock of such bank or of any wholly-owned subsidiary of the bank holding company which owns the majority of the capital stock of such bank and the assessed value, up to the amount of the unencumbered equity, of real estate in the nature of improvements which are owned by the bank, or used or occupied by the bank and held byBaby a majority-owned subsidiary or a bank holding company or a wholly-owned subsidiary of a bank hold1ngholding company, even if assessed in the name of some other person because of the ownership of the underlying land by such person.

Real estate used or occupied by a subsidiary or originally conveyed as col2ateralcollateral for loans made by a subsidiary of the bank and reacquired upon foreclosure of mortgage loans will be deemed to be used or occupied by the bank.

The book value of tangible personal property which shall be held for lease and is otherwise taxed doeswhich notis ownowned allby the stock of such subsidiary,bank itor shallin be entitled to deduct only such portion of the assessedname value of thea realmajority-owned estatesubsidiary and the value of such tangible personal property as the commonbank. stock it owns in such subsidiary bears to the whole issue of common stock of such corporation.

If the bank does not own all the stock of such subsidiary, it shall be entitled to deduct only such portion of the assessed value of the real estate and the value of such tangible personal property as the common stock it owns in such subsidiary bears to the whole issue of common stock of such corporation.

For purposes of computing such percentage, total assets shall shallnot include all obligations of the Unitedgoodwill Statesdescribed exemptin fromsubdivision taxation5. under 31 U.S.C.

§The 3124,obligations of theinthe United States Constitutionas orused anyherein othershall statute,include orall anyobligations instrumentality or agency of the United States which obligations shall be exempt from state or local taxation under the31 UnitedU.S.C. States Constitution or any statute of the United States.

§ 3124, of the United States Constitution or any other statute, or any instrumentality or agency of the United States which obligations shall be exempt from state or local taxation under the United States Constitution or any statute of the United States.

In addition, any portion of the amount added to federal taxable income pursuant to subdivision B 9 of § 58.1-402 by a corporation that is for interest expenses and costs paid to the bank for a loan or other obligation made by the bank to such corporation shall be deducted from the gross capital of the bank provided that (i) at the time of payment of such portion to the bank, the bank was a related member of the corporation, and (ii) such portion has not otherwise been deducted from grosswasgross a capital.

electronicallyA. with the commissioner of the revenue or comparable assessing officer of the county, city or town where the principal office of the bank is located on or before March 1, a return in duplicate of 2 which that shall set forth the tax on net capital as computed under this chapter.

TheEach returnbank shallas bedefined in a§ form58.1-1201 prescribedas byof theJanuary Department1 of Taxationeach Theyear Departmentshall ofprepare Taxationand shallfile maintainelectronically awith securethe onlinecommissioner portalof tothe receiverevenue returnsor andcomparable otherassessing requiredofficer submissionsof underthe thiscounty, chaptercity inor atown mannerwhere prescribedthe byprincipal office of the Departmentbank foris uselocated byon commissionersor ofbefore theMarch revenue1, ora otherreturn assessingin officersduplicate ofwhich anythat localityshall inset acceptingforth filedthe returnstax andon certifyingnet andcapital transmittingas returnscomputed tounder thethis Department.chapter.

The return shall be in a form prescribed by the Department of Taxation The Department of Taxation shall maintain a secure of 2 online portal to receive returns and other required submissions under this chapter in a manner prescribed by the Department for use by commissioners of the revenue or other assessing officers of any locality in accepting filed returns and certifying and transmitting returns to the Department.