Virginia House Bill HB2667

Virginia 2025 Regular Session

• Introduced: 1/15/25
• Refer: 1/15/25

Caption

Income tax, state; creation of currently not collectible status.

Impact

The implementation of HB2667 could significantly alter how the Commonwealth handles cases where individuals are unable to pay their taxes due to financial hardships. By allowing taxpayers to formally apply for CNC status, it introduces a structured process that could provide relief and potentially prevent further financial stress for individuals in difficult situations. However, this measure also raises questions about potential impact on state revenue and how these protections will be balanced with the state's ability to collect due taxes.

Summary

House Bill 2667 introduces a framework for individuals seeking currently not collectible (CNC) status concerning their state income tax liabilities in Virginia. This proposal enables taxpayers who can demonstrate undue hardship to apply for CNC status, thereby suspending tax collection efforts by the Department of Taxation during the applicant's financially challenging circumstances. The bill outlines specific guidelines and requirements for taxpayers to qualify for this status, including a commitment to remain domiciled in Virginia and the filing of all required tax returns.

Contention

There are notable points of contention regarding how the bill's provisions for CNC status might be received by various stakeholders. Supporters may argue that it creates a necessary safety net for vulnerable populations facing financial crises, while critics could raise concerns about the implications for state revenues and the potential for perceived abuse of the CNC application process. The effectiveness of established guidelines and oversight by the Tax Commissioner will likely be a focal point of discussion as the bill moves forward.