The following examples illustrate computation of the tax:
Example 1: Trust A, a resident trust, has federal taxable income for short taxable year 1983 of $20,000. Trust A also has $1,000 in interest income from obligations of the State of New Jersey which are exempt from federal but not Virginia tax, and $2,000 in interest on U.S. Treasury obligations. The Trust changed its taxable year to a 10-month period ending October 31, 1983. Its Virginia tax for the short taxable year is computed as follows:
Federal taxable income | $20,000 | |||
Plus: Taxable interest (N.J.) | $1,000 | |||
21,000 | ||||
Less: Exempt interest (U.S.) | 2,000 | |||
Taxable Income | $19,000 | |||
Annualized Virginia Taxable Income (19,000 x 10/12) | $22,800 | |||
Tentative tax (on $22,800) | $1,091 | |||
Actual tax ($1,091 x 10/12) | $909.17 |
Example 2: Trust B, a nonresident trust, has Virginia taxable income for short taxable year 1982 (a 7-month period) of $14,000. Its Virginia tax for the short taxable year is computed as follows:
Virginia taxable income | $14,000 | |
Annualized Virginia Taxable Income (14,000 x 12/7) | $24,000 | |
Tentative tax (on $24,000) | $1,160 | |
Actual tax ($1,160 x 7/12) | $676.67 |
23 Va. Admin. Code § 10-115-100
Statutory Authority
§§ 58.1-203 and 58.1-380 of the Code of Virginia.