Split Virginia Supreme Court Hands State Victory in Addback Statute Dispute

Overview


Lauren Ferrante said she was “disappointed” that the Virginia Supreme Court held royalty payments made by a company to an affiliate must be actually taxed in another state for Virginia’s addback safe harbor exception to apply. “The majority’s interpretation of ‘subject to tax’ lacks support in the statute’s plain language, both before and after the budget bills that purport to be retroactive,” Ms. Ferrante noted.