Member action needed: Virginia lawmakers introduce legislation to repeal rolling conformity

In 2023, the VSCPA successfully lobbied for rolling income tax conformity legislation at the Virginia General Assembly. Lawmakers spent the previous two decades passing retroactive emergency tax conformity legislation each year to update Virginia’s conformity to the U.S. Internal Revenue Code (IRC) — causing tax season filing delays and angst for tax preparers and taxpayers alike. The success was the culmination of a multi-year effort to earnestly and aggressively advocate for rolling conformity.

The 2023 legislation included certain revenue safeguards, such as not automatically adopting any federal change with a positive or negative revenue impact of $15 million or more and limiting the automatic adoption of federal changes under the $15 million threshold to an aggregate of $75 million. 

Now, budget amendments made by committees in Virginia’s House and Senate threaten the great strides we made to simplify tax season. The amendments remove the thresholds included in rolling conformity legislation and state that Virginia will not conform to any new federal changes with any fiscal impact. You can see the House amendment here and Senate here.

These amendments are surprising: No legislation or budget amendments removing the thresholds were previously introduced, and there was no opportunity for public input or testimony. Additionally, the VSCPA is concerned this change would be made permanent through a series of complex enactment clauses that will be difficult for taxpayers and tax practitioners to understand — creating complexity and confusion in complying with Virginia’s tax code. 

The VSCPA legislative team is working nonstop at the Capitol to make lawmakers aware of the risks these changes create. We’re calling on all members to send a quick message to their legislators via our VoterVoice tool. Messages are pre-written (you can personalize with your own stories) and sending takes less than a minute.

Questions? Feedback? Contact Emily Walker, CAE, VSCPA vice president, advocacy & pipeline.