Virginia State Tax Credits
Without passing judgment on the principals in this story, a recent article that caught my attention in RichmondBizSense is a good reminder about the continuing controversies concerning Virginia state tax credits. For those considering purchasing rehabilitation or conservation credits: Buyer Beware. Be sure that you are purchasing from a credible source on whose due diligence you can rely that the credits will withstand Department of Taxation scrutiny. Moreover, this story highlights how difficult it is to create economic incentive programs that restrict use to the original stated objectives and spirit of the law, and apply proper controls to avoid misuse. I have helped businesses and their owners take advantage of a broad array of well-intentioned state and Federal incentives – refundable Virginia R&D credits are a recent addition. But marginal or outright fraudulent use, and failure of the controls in place, will undoubtedly cause rank and file taxpayers to lose faith in them.