What 2012 estimated-tax penalty relief did Virginia give qualifying farmers, fishermen, and merchant seamen?

Plain-English summary

Virginia automatically waived the 2012 estimated-tax underpayment penalty for qualifying farmers, fishermen, and merchant seamen who filed and fully paid by April 15, 2013. The usual special deadline was March 1, but federal form and system updates following late federal legislation could delay filing.

The relief applied where at least two-thirds of estimated Virginia gross income came from self-employed farming, fishing, or work as a merchant seaman. These filers generally avoided quarterly estimates and the underpayment penalty by filing and paying in full by March 1.

For 2012 only, the bulletin moved that practical deadline to April 15, 2013. No special waiver form or other action was required.

What this means for you

• This was one-time relief for 2012 returns and is now historical.
• The filer still had to meet the two-thirds income test.
• Both filing and full payment had to occur by April 15, 2013.

Common questions

Q: Was a separate waiver request required?
A: No. Relief was automatic if the return and full payment were timely under the bulletin.

Q: Did the bulletin eliminate the tax due?
A: No. It waived the estimated-tax underpayment penalty; the entire tax still had to be paid.

Subject

Penalty Relief for Farmers, Fishermen and Merchant Seamen

Source

• Landing page: Virginia Laws, Rules & Decisions
• Ruling: P.D. 13-12

Original ruling text

TAX BULLETIN 13-2

Virginia Department of Taxation

January 31, 2013

Penalty Relief for Farmers, Fishermen and Merchant Seamen

Estimated Tax Underpayment Penalty Relief

In response to recent action by the Internal Revenue Service, Tax Commissioner Craig M. Burns announced relief from the estimated tax underpayment penalty for farmers, fishermen and merchant seamen unable to file and pay their 2012 taxes by the March 1 deadline. Virginia will also allow these individuals additional time to file and pay their taxes. Farmers, fishermen and merchant seamen will be provided relief from the estimated tax underpayment penalty provided a return is filed and payment of the entire tax due is made by April 15, 2013.

Due to the late passage of federal tax legislation, the Internal Revenue Service announced that it is currently in the process of updating forms and reprogramming systems to reflect these legislative changes. The Internal Revenue Service indicates these changes may delay these individuals from being able to file and pay their taxes by the March 1 deadline.

Under Virginia law, farmers, fishermen and merchant seamen with two-thirds of their estimated Virginia gross income from self-employed farming, fishing or being a merchant seaman have special filing requirements. These individuals do not make quarterly estimated tax payments and are not subject to an estimated tax underpayment penalty provided their return is filed by March 1 and the entire tax is paid at that time.

In order to receive an automatic waiver of the estimated tax underpayment penalty, farmers, fishermen and merchant seamen need only to file their returns and pay the entire tax due by April 15, 2013. No special action is required. If you have additional questions, please visit our website at http://www.tax.virginia.gov or contact us at (804) 367-8031.