500-042 e-file error

Form 500: Rule Number: 500-042 If the corporation is not a multistate, Income Tax on Line 9 must equal .06 x Line 7.

This happens when apportionment computation doesn’t match to the actual apportionment percentage.

Solution 1

In Tax Forms, select States
,Virginia
then 500 - Virginia Corp. Income Tax Return
.

Select the 500, Page 2
tab.

Line 8a needs data that ties out with Sch 500a Section B line 3j.

Form 500A only populates on the form when:

the Property factor is less than 100%

the payroll factor is less than 100%

the Sales factor is less than 100%.

In Tax Forms, select States
, then Virginia
, then Apportionment Forms
.

Select 500, Sch A - Multistate Corporation
.

Go to Section B, line 1, column C.

If 100% is entered here, then the amount won’t transfer to Form 500 Page 2 line 8a from 500 Sch A Section B line 3j.

Remove the 100% to clear the reject.

Perform a full recompute and recreate the e-file.