EDC Company Sues GVI Over Decade-Long Tax Refund Delay, With $300,000 in Interest Piling Up Each Quarter

A local loan servicing company is suing the Government of the Virgin Islands for money it says it is owed for income tax overpayments.

Ocwen USVI Services LLC, in a complaint filed with the District Court of the Virgin Islands on February 8, says that the Bureau of Internal Revenue owes it over $20 million in tax refunds and interests.

The issue dates back to tax year 2013, when Ocwen Mortgage Services, a beneficiary of the Economic Development Commission program, made income tax payments of over $17 million to BIR. The company’s tax return filed that year — one year after official commencing operations in the USVI — showed an overpayment of $927,546, which it elected to roll over to tax year 2014, according to documents filed in court.

The payments for tax year 2014 were over $20 million which, when the company’s tax return was filed, reportedly represented an overpayment of over $14 million. Like the previous tax year, OMS decided to use the overpayment as a credit for the following year.

However in tax year 2015, the company realized a net operating loss, and asked BIR to refund the current credit balance of $14, 225,083. In 2017, OMS filed an amended tax return for 2013 which resulted in a hefty decrease in assessed taxes. The balance created from that amended return – just over $7.5 million – was also requested as a refund. Another amended tax return was filed, this time for tax year 2014. A balance of $5.7 million resulting from that amendment was also requested as a refund.