The Virginia Department of Taxation is participating in a federal vendor offset program in cooperation with the U.S. Department of the Treasury to recoup taxes owed by Virginia businesses. Vendors that do business with the federal government and owe Virginia taxes may have their federal payments withheld, or offset, by the amount of the tax debt.

All Virginia businesses that owe state taxes, with the exception of pass-through entities, will receive letters from the Tax Department this month outlining three options  to avoid having federal vendor payments withheld.

These options include:

1. Pay the balance due online using QuickPay or mail the payment following the instructions on the tear-off coupon at the bottom of the letter. Payments can also be made by credit card at officialpayments.com or by calling (800) 2PAYTAX. The jurisdiction code for Virginia is 1800.
2. Provide proof of bankruptcy protection. Send a copy of the bankruptcy petition to: Virginia Department of Taxation, Bankruptcy Unit, P.O. Box 2156, Richmond, VA 23218-2156.
3. Contact the Tax Department. If the balance due is incorrect,call (804) 367-8037 to request a review, explanation or confirmation of the balance due. Customer Services representatives are available Monday through Friday, 8:30 a.m. to 5 p.m. If payment of the tax debt has already been made, fax proof of payment to (804) 254-6111 within 30 days of receiving the letter to provide time to resolve the offset. A cancelled check, credit card or debit card confirmation number can serve as proof of payment. 

If a business doesn't take one of these actions by the deadline stated in the letter, the Tax Department will submit the amount of the tax debt to the U.S. Treasury to begin the offset process.

More information is available on the Tax Department's website at Federal Vendor Offset Payment Frequently Asked Questions and U.S. Department of the Treasury Offset Program. To speak with a Collections representative, call (804) 367-8045.