Wednesday, February 8, 2012

Tax Conformity Becomes Law Early in Legislative Session

We are about one month into the 2012 General Assembly 60-day, or “long,” legislative session, and the VSCPA has been working hard tracking hundreds of bills introduced in the House of Delegates and Senate this year. We already have an early victory with the quick passage of tax conformity — Gov. Bob McDonnell signed the bill into law yesterday, which is one of the earliest dates the bill has passed in the past decade or so that Virginia has had fixed-date tax conformity.

There still is a conformity bill related to Section 199 of the Internal Revenue Code that has not yet passed the legislature as of today, although it affects tax year 2012, not 2011. HB 1153 and SB 462 allow the entire amount of the deduction allowed for domestic production activities pursuant to §199 to be deducted for Virginia income tax beginning on and after Jan. 1, 2012. This provision has been an item of contention for the past few years, which is why we agreed to have it addressed in a separate bill. We will watch that bill and report on its outcome.

We are also monitoring closely several other bills affecting CPAs. You can see all of the legislation we are tracking at our 2012 Session Watch page. You can also read Emily Walker’s blog post about two hot items we are working on — one deals with the penalties associated with tax due returns on extension that are electronically filed, and the second requires the Auditor of Public Accounts (APA) to outsource all audit work to CPA firms.

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