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Craig D. Bell Partner

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Richmond T +1 804 775 1179 F fax +1 804 698 2160
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Craig is a nationally recognized tax attorney and tax litigator who represents individuals and businesses having significant tax disputes with federal, state, or local taxing jurisdictions. A former chair of the firm’s Tax and Employee Benefits Department, he also leads the firm’s state and local tax, and tax litigation practice areas. Craig’s formal training and more than thirty-five years as a business tax lawyer and tax litigator uniquely qualify him to represent clients on their most significant tax disputes before the tax agencies of all three levels of government.

Craig serves as the firm’s lead tax litigator in both trial and appellate federal, state and local tax disputes. He has substantial experience in all areas of tax law with a primary emphasis on state and local taxation, and civil and criminal tax litigation at federal, state and local levels.

Craig also regularly represents and advises businesses and their owners on matters relating to the negotiation, design and implementation of business expansion and relocation economic incentive programs and legislation; state tax legislation lobby activities; and other business transaction services. He is a co-founder and board chairman of Village Bank Financial Corporation, a publicly held commercial bank headquartered in Richmond.

Craig graduated from the State University of New York at Buffalo School of Law in 1983, serving as vice justice of Phi Alpha Delta from 1982 to 1983 and earning an Outstanding Member Award. He received his post-doctorate masters of law and taxation from the Marshall-Wythe School of Law at the College of William and Mary in 1986. He also graduated from Syracuse University, magna cum laude, in 1979; and received his masters in business administration from Syracuse University in 1980. There he served as president from 1978 to 1979 and vice president from 1977 to 1978 of Delta Nu Alpha, Syracuse University Chapter, International Transportation Management Association. Craig also was a member of Beta Gamma Sigma, an international management honors fraternity. He is a recipient of the following awards: Salzberg Outstanding Transportation Management Student Award, 1978; National Defense Transportation Association Outstanding Student Award, 1979; and University Honors Program Graduate, 1979.

Craig served as a judge advocate general in the U.S. Army for six years on active duty. Upon leaving active duty he joined the Army Reserves where he was assigned to the U.S. Army’s law school and served as the tax and estate planning advisor to the judge advocate general of the U.S. Army. He was recalled to active duty when selected to lead the Department of Defense emergency legal office created to provide legal assistance to victims and their families from the 9-11 Pentagon attack. Craig retired from the Army Reserves in 2006 as a lieutenant colonel after completing 27 years of service.

He is a fellow of the American College of Tax Counsel and serves on the William and Mary Tax Conference Advisory Council. Craig is a past chair of both the Virginia State Bar Section of Taxation (two times) and Virginia Bar Association Tax Section, as well as past chair of the Virginia State Bar Military Law Section. He is a Master of the J. Edgar Murdock Inn of Court (U.S. Tax Court).

Craig serves as adjunct professor at the College of William and Mary Law School where he teaches both federal tax litigation and state and local tax courses. He was also a former adjunct professor for Virginia Commonwealth University’s master’s in taxation program where he taught state and local taxation. He is a frequent lecturer on federal, state and local tax topics for a number of law and accounting professional organizations including the T.C. Williams School of Law at the University of Richmond, the American Bar Association, the Virginia Law Foundation of the Virginia Bar Association and the Virginia State Bar, the Annual University of Virginia Conference on Federal Taxation, the Annual William and Mary Tax Conference, the U.S. Army Judge Advocate General’s Leadership Center and School, the Institute for Management Accountants, the Virginia Society of Certified Public Accountants, and a number of other law and accounting professional organizations.

Craig also serves as director emeritus of the Community Tax Law Project, a charitable nonprofit organization that provides low-income Virginia taxpayers with pro bono legal representation in federal, state and local tax disputes, and he is a past president of the organization. Craig serves as a board trustee for the Virginia War Museum and the Henricus Historical Park Foundation.

Craig has authored a variety of articles involving all aspects of state and local tax issues for State and Local Taxes Weekly published by the Research Institute of America; the Multistate Tax Report, published by BNA’s Tax Management, Inc.; and for State Tax Notes, published by Tax Analysts, Inc.

Experience

  • In a case of first impression, the Virginia Court of Appeals in its first tax decision since it acquired jurisdiction for tax cases held that a taxpayer may elect to use the alternative manufacturer’s income apportionment method contained in Code of Virginia Section 58.1-422 for the first time in an amended corporate income tax return, as opposed to on the original return filed with the Virginia Department of Taxation.
  • Obtained a complete trial court victory holding that a Utah corporation conducting oil refining operations is not operating as a unitary business with a separate gasoline retail business of which it held a 14 percent minority ownership interest.
  • In the Virginia Supreme Court, obtained a precedential unanimous reversal decision and holding that a county’s machinery and tools tax assessment was unconstitutional because it was non-uniform, invalid and illegal in violation of the Constitution of Virginia.
  • In the Virginia Supreme Court, obtained a unanimous decision holding a locality was not entitled to retain $8.3 million in machinery and tools taxes despite the taxpayer maintaining $140 million of taxable value of machinery and tools within the locality.
  • Obtained an appellate victory for a large international trucking company in the U.S. Court of Appeals for the Seventh Circuit involving several issues of first impression by holding the trucking company was not subject to the federal excise tax under Internal Revenue Code section 4051(a)(1) when it leased refurbished highway tractors because the company qualified for the safe harbor in Internal Revenue Code section 4052(f) and ordered a refund of approximately $15 million in excise tax to the trucking company.
  • In the Virginia Supreme Court, obtained a unanimous decision holding a county’s BPOL gross receipts tax on a taxpayer’s sales of duty-free goods to international travelers violated the United States Constitution’s Import-Export Clause, which prohibits states from imposing taxes and duties on exported goods without express permission from Congress. Successfully protected the Virginia Supreme Court’s decision by opposing the local government’s writ of certiorari before the United States Supreme Court.
  • In the U.S. Tax Court, successfully defended a publicly owned consumer debt collector from an involuntary change in method of accounting by the IRS that would have accelerated recognition of revenue causing a tax deficiency of $300 million, together with accrued interest of $150 million.
  • For a Fortune 50 manufacturer company, obtained a $5 million tax refund of machinery and tools tax by successfully challenging the local government’s assessment methodology as violative of the Virginia Constitution.
  • In case of first impression in Virginia, summary judgment was granted in favor of purchaser of a service assessed with use tax, holding that use tax did not apply to the purchase of services that might otherwise be subject to sales tax, and that any sales tax (as opposed to use tax) that might apply to certain services may only be levied against the vendor.
  • Overturned $300 million assessment against owners of privately held multinational corporation at IRS Office of Appeals, after IRS issued Revenue Ruling upholding client’s position that clients were not required to include in income receipt of $224 million received in first year of structured PEPS (Premium Exchangeable Participating Shares) transaction and that inclusion of money in income was deferred until transaction closed four years later.
  • On behalf of Fortune 500 company, overturned civil penalty assessment in excess of $1 million on tax shelter listed transaction and denial of deduction for meals and entertainment expenses through the use of a random sample statistics study, despite IRS policy against use of statistical studies for IRC section 274 documentation and substantiation purposes.
  • In a landmark decision of the Virginia Supreme Court, prevented a locality from applying tangible personal property and machinery and tools taxes to property located at corporate headquarters, thereby eliminating a multimillion-dollar tax assessment.
  • Effectively overturned a $1 million assessment of gift taxes on a corporate stock transfer and subsequent valuation dispute before the U.S. Tax Court.
  • Effectively challenged a $900,000 income tax transferee liability assessment before the U.S. Tax Court.
  • In litigation before the U.S. Tax Court, overturned $500,000 late filing of return penalty by demonstrating grantor trust beneficiary was denied access to records by overbearing and hostile trustee. Sustained result before federal court of appeals.
  • Effectively challenged tax assessment, affirmed on appeal, involving civil fraud penalty and valuation of stock in closely held business involving multi-tiered entity timeshare resort owner before the U.S. Tax Court.
  • Effectively challenged state business and occupancy tax assessments in U.S. Bankruptcy Court, despite debtor taxpayer’s failure to timely challenge such assessments before state tax agency.
  • On behalf of one of the world’s largest publicly traded chemical manufacturer, prevented North Carolina localities from reclassifying certain manufacturing facilities for property tax purposes.
  • In litigation before the U.S. District Court, effectively challenged multimillion-dollar tax assessment that was based on the Internal Revenue Code section 469 passive activity loss rules.
  • On behalf of a publicly traded manufacturing company, struck down a gross receipts tax ordinance on Commerce Clause grounds, and sustained result with success defense before the Virginia Supreme Court.
  • Effectively challenged a locality’s attempt to impose property taxation on a satellite in geo-stationary orbit above the Earth, and sustained the victory before the state’s supreme appellate court.
  • Prevailed on class action claims under ERISA for early retirement incentive benefits, breach of fiduciary duty, and claims for statutory penalties for failing to produce plan documents.
  • Effectively challenged horse breeding hobby loss tax assessment before the U.S. Tax Court despite 15 years of consecutive net operating losses.
  • On behalf of a publicly traded jet propulsion engine manufacturer, eliminated the use tax imposed on die cast molds used by the manufacturer but owned by other companies.
  • On behalf of the Virginia Chamber of Commerce and Virginia Manufacturers Association, prevented contract auditors in Virginia. The resulting Virginia Supreme Court decision closely followed the positions advocated in the legal briefs filed on behalf of these organizations.
  • On behalf of a Fortune 500 company, effectively challenged a tax assessment exceeding $1 million, and established Virginia law that clearly placed the burden of proof upon the state tax department to demonstrate that it issued a notice of assessment within the three-year limitations period.

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