QBA: Application for Designation as a Qualified Business for the Qualified Equity and Subordinated Debt Investments Tax Credit (2025)
Virginia · Virginia Tax · Used for tax years 2025
Virginia Form QBA is an application for designation as a qualified business for the Qualified Equity and Subordinated Debt Investments Tax Credit. It reports business information, qualification details, business activities, and planned equity or subordinated debt issuances.
Who files this form
Businesses that want to issue equity or subordinated debt investments for which investors may claim the Virginia Qualified Equity and Subordinated Debt Investments Tax Credit must file Form QBA.
A qualified business must:
- Have annual gross revenues of no more than $3 million in its most recent fiscal year.
- Have its principal office or facility in Virginia.
- Be primarily engaged in business in Virginia or do substantially all of its production in Virginia.
- Have received no more than $3 million in total gross cash proceeds from issuing equity or debt during its existence, excluding commercial loans from chartered banking or savings and loan institutions.
- Be primarily engaged, or organized to engage, in a qualifying field: advanced computing, advanced materials, advanced manufacturing, agricultural technologies, biotechnology, electronic device technology, energy, environmental technology, information technology, medical device technology, nanotechnology, or a similar technology-related field determined by Department regulations.
For these purposes, primarily engaged in Virginia means at least 50% of gross receipts come from Virginia sources. Substantially all production in Virginia means at least 80% of expenses are incurred in Virginia.
A business in its first taxable year is treated as meeting the revenue and Virginia business/production requirements if its commercial domicile is in Virginia. Commercial domicile is the state where the principal office directing or managing the business is located.
When it's due
File Form QBA any time during the calendar year. The designation is valid for the calendar year of the application.
You must submit a separate application each year that you want the business to be eligible to offer this credit to investors. Form QBA does not have to be filed before issuing the investments.
What you'll need
Have the following information ready to complete Form QBA:
- Business name, trading name, FEIN, incorporation date, address, and NAICS description and code.
- Business entity type and qualifying technology field.
- Answers to the qualification questions, including the most recent fiscal year's gross revenues and whether total equity or debt proceeds exceed the stated limit.
- The institution's name, if the business was created to commercialize research developed at or in partnership with a higher education institution.
- A detailed description of the business activities. Enclose additional pages if needed.
- The type of investment planned, estimated amount, and anticipated first issuance date.
- An authorized signature, title, date, printed name, phone number, and fax number. The email address is optional.
How to file
Before completing Form QBA, the business should be registered with the Virginia Department of Taxation. If it is not registered, use Online Services for Businesses at www.tax.virginia.gov to register.
Enter the calendar year, complete Parts I through VII, and have an authorized person sign the application.
Mail Form QBA to:
Virginia Department of Taxation
Tax Credit Unit
P.O. Box 715
Richmond, VA 23218-0715
You may instead fax the form to (804) 774-3902. Do not both mail and fax it.
For help with the application, call (804) 786-2992.
Common mistakes
- Sending the application twice: The instructions say to mail or fax it, not both.
- Assuming the designation renews automatically: A separate application is required each year.
- Continuing after a disqualifying answer: Part IV directs you to stop if you answer No to questions 2, 3, or 4, or Yes to question 5.
- Entering an email address when you do not want email communications: Providing an email address gives consent for Department emails about this application. Leave it blank if you do not want those communications.
- Combining incompatible benefits: An investor cannot receive a Small Business Investment Grant Fund grant and claim this credit for the same investment. The investor also cannot claim the subtractions for certain long-term capital gains for that same investment.
Questions people ask
Does Form QBA have to be filed before the business issues an investment?
No. The form specifically says it does not have to be filed before making issuances.
Does the business need a new application every year?
Yes. Qualification is valid for the calendar year of the application. Submit a separate application for each year the business wants to offer this credit to investors.
What must the business give investors when it issues equity or subordinated debt?
The business must provide each investor with a copy of its Department-issued qualified business certification and a statement on business letterhead. The statement must identify the investor, list each investment's amount, type, and date, and verify that it meets the qualified investment requirements. It must also include the required compensation and instrument terms and be signed as directed in the instructions. The investor must enclose the statement with Form EDC.
Can married investors receive the credit jointly?
No. Each spouse must invest individually, and a separate Form EDC and business statement must be provided for each spouse.