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Virginia Supreme Court affirms related-party addback safe harbor exception applies on post-apportioned basis

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In a split 4-3 decision, the Virginia Supreme Court affirmed that the safe harbor exception from the Virginia corporation income tax related-party addback for certain corporate expenses applied only to the portion of intangible expenses on which tax was actually imposed. However, the Court allowed the application of the exception regardless of which entity in the related-party group actually paid the tax.