58.1-3994 - Offers in compromise with respect to local taxes.

§ 58.1-3994. Offers in compromise with respect to local taxes.

A. Notwithstanding any other provision of law, the commissioner of therevenue or other official responsible for the assessment of any local taxappealed pursuant to § 58.1-3703.1 or § 58.1-3983.1 may, in his solediscretion, compromise and settle any disputed assessment of taxes prior tothe time that such assessment is no longer subject to administrative orjudicial review pursuant to applicable law if the commissioner or otherofficial responsible for assessment determines that there is substantialdoubt under applicable law, regulations, or guidelines as to the taxpayer'sliability for such taxes.

B. Notwithstanding any other provision of law, the treasurer or otherofficial responsible for the collection of any local tax imposed pursuant tothis title may, with the consent of the governing body or its designee,compromise and settle the amount due and payable when the treasurer or otherofficial determines that the collection of the entire amount due and owing isin substantial doubt and the best interests of the locality will be served bysuch compromise. Whenever a tax otherwise due and owing is compromisedpursuant to the provisions of this subsection, the difference between theamount of tax then due and owing, and the amount of tax paid pursuant to suchcompromise, shall be treated for the purposes of § 58.1-3921 in the samefashion as a tax rendered legally uncollectible by reason of the applicationof the United States Bankruptcy Code.

C. Any offer in compromise submitted to an official responsible for theassessment or collection of local taxes shall be made in writing and shall bedeemed accepted only when the taxpayer is notified in writing of theacceptance by the responsible official.

D. Whenever a compromise and settlement is made pursuant to the provisions ofthis section, the responsible official shall make a complete record of thecase, including: (i) the tax assessed; (ii) audit findings, if any; (iii) thetaxpayer's grounds for dispute or contest together with all evidencesthereof; (iv) factors calling collectibility into substantial doubt; (v) anynonprivileged reports or recommendations made with respect to the liabilityof the taxpayer, the requirements of effective tax administration considered,and/or the collectibility of taxes due; and (vi) the amount assessed oraccepted and the terms and conditions attendant to settlement or compromise,with respect to the liability in question.

E. The treasurer or other official charged with collection of taxes maydeposit into the treasury of the county, city or town any and all paymentssubmitted with offers in compromise, unless the taxpayer specifically,clearly and conspicuously directs otherwise in writing at the time the offerin compromise is submitted to the responsible official. For the purposes ofthis subsection, no restrictive endorsement or other notation upon a check orother payment instrument shall constitute clear and conspicuous notice of adirection not to deposit.

F. Upon acceptance of an offer in compromise by the responsible localofficial with respect to a tax liability, the matter thereafter may not bereopened except upon a showing of fraud, malfeasance or misrepresentation ofa material fact.

(2004, c. 526.)