FWV: Farm Wineries and Vineyards Credit Application (2024)

Who files this form

Virginia farm wineries and vineyards with qualified capital expenditures may apply for this credit. To receive the credit, applicants must submit Form FWV each year.

• A Virginia farm winery is an establishment in Virginia licensed as a farm winery under Va. Code § 4.1-206.1.
• A Virginia vineyard is agricultural land in Virginia with at least one contiguous acre dedicated to grapes used, or intended to be used, to produce wine by a Virginia farm winery. The definition includes plants and other improvements on that land.

The expenditures must be connected with establishing a new Virginia farm winery or vineyard, or making capital improvements to an existing one.

When it's due

For tax year 2024 expenditures, the application and review dates fall in the following calendar year:

• April 1: Deadline to complete and mail Form FWV and attachments.
• May 1: The Department will contact you by this date if it needs additional information.
• May 15: Deadline to respond to that request.
• May 31: If you have not received acknowledgment of your application by this date, call (804) 786-2992.
• June 30: The Department will issue the credit by this date.
• July 15: If you have not received your credit certification by this date, call (804) 786-2992.

For an application received without a postmark, the Department uses the date it receives the application to determine whether it met the deadline.

If the return claiming the credit is due on or before May 1, you may need to submit an extension payment for any tax due or file an amended return after receiving credit certification.

What you'll need

• Form FWV: Provide the tax year, business name, FEIN or SSN, address, entity type, business qualification, credit calculation, and authorized signature.
• Schedule A: Enclose a detailed description, amount, purchase date, and supplier for each qualified expenditure. You may submit copies of Schedule A if you need more space.
• Supporting records: Keep receipts and other supporting documentation for your records. Examples include invoices, canceled checks, bank statements, and credit card statements. Documentation must clearly separate qualified capital expenditures from ineligible costs.
• Form R-1, if needed: Business taxpayers should be registered with the Department before completing Form FWV. If not registered, complete Form R-1.
• Pass-through entity documents: An entity allocating the credit to participants must file Form TCA and give each participant Schedule VK-1, Owner’s Share of Income and Virginia Modifications and Credits.

How to file

1. Complete the taxpayer and business information on Form FWV.
2. List qualified capital expenditures on Schedule A and enter the total on Line 1. Multiply Line 1 by 25% to calculate the credit requested on Line 2.
3. Sign and date the application, and enclose Schedule A and any other attachments.
4. Submit the application using one of these methods:

Mail:

Virginia Department of Taxation

ATTN: Tax Credit Unit

P.O. Box 715

Richmond, VA 23218-0715

Fax: (804) 774-3902

Do not both mail and fax the application. The supplied text does not provide an e-file method.

Wait for approval before claiming the credit on your Virginia income tax return. The Department will issue a certificate showing the amount you may claim.

Pass-through entities allocating the credit must also submit Form TCA to the same mailing address or fax number, but not both.

Common mistakes

• Including expenses deducted under IRC § 179. You cannot claim this credit and a federal deduction under IRC § 179 for the same expenses.
• Including ineligible costs. Utilities, service costs, repair costs, maintenance costs, and expenditures not on the qualified-expenditure list are ineligible. Supporting documentation must clearly separate eligible and ineligible costs.
• Claiming the credit before approval. The credit must be approved before you claim it on your return.
• Submitting by both mail and fax. Choose only one method for Form FWV or Form TCA.
• Overlooking business registration. Business taxpayers should be registered with the Department before completing Form FWV.
• Providing an email address when you do not want email communications. Entering an email address gives consent to receive email about this application. Leave the email fields blank if you do not want electronic communications.
• Skipping Form TCA when allocating a pass-through credit. Failure to file it may cause the participant’s credit claim to be disallowed or delay return processing. Credits must be allocated in proportion to ownership or participation.

Questions people ask

How much is the credit?

The credit is 25% of qualified capital expenditures. Total credits available to all taxpayers are capped at $250,000 per calendar year. If applications exceed that cap, the Department allocates credits on a pro rata basis.

What purchases can qualify?

The printed list includes items such as barrels, bottling equipment, grape plants, irrigation equipment, tractors, wine tanks, and wire. Only expenditures on the qualified list are eligible, and they must relate to establishing a new Virginia farm winery or vineyard or making capital improvements to an existing one.

What if my approved credit is more than my tax liability?

Credit amounts exceeding your tax liability may be carried forward for 10 years.

How do pass-through entities distribute the credit?

Partnerships, S corporations, and LLCs allocate the credit to their partners, shareholders, or members in proportion to ownership or interest in the business. Each pass-through entity allocating the credit must file Form TCA and provide each participant with Schedule VK-1.

Where can I get help?

Call (804) 786-2992 or write to the Virginia Department of Taxation, ATTN: Tax Credit Unit, P.O. Box 715, Richmond, VA 23218-0715.

Official sources

• https://www.tax.virginia.gov/sites/default/files/taxforms/credits-subtractions-and-deductions/2024/fwv-2024.pdf