Disclaimer: Calculations are estimates based on tax rates as of Jan. 2023 and data from the Tax Foundation. These rates are subject to change. Check the IRS website for the latest information about income taxes and your state tax website for state-specific information. Our calculator doesn’t consider both 401k and IRA deductions due to the tax law limitations. Please note, the amount of your IRA deductions may vary. You should speak with a tax professional to determine your tax situation.
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What You Need To Know About Virginia State Taxes
The state of Virginia requires you to pay taxes if you’re a resident or nonresident that receives income from a Virginia source. The state income tax rates range from 2% to 5.75%, and the general sales tax rate is 5.3% (which is 4.3% state tax and 1.% local tax). Some regions may assess additional sales taxes.
Virginia state offers tax deductions and credits to reduce your tax liability, including a standard deduction, itemized deduction, dependent care credit deductions, credits for taxes paid to other states and more.
Virginia Income Tax Brackets and Rates (For All Filing Statuses)
If your Virginia taxable income is over: | But not over: | Your tax is: |
---|---|---|
$0 | $3,000 | 2% of your income |
$3,000 | $5,000 | 3% of your income amount over $3,000 + $60 |
$5,000 | $17,000 | 5% of your income amount over $5,000 + $120 |
$17,000 | And Over | 5.75% of your income amount over $17,000 + $720 |
Income Tax Deductions for Virginia
Standard Deduction
The state of Virginia offers a standard and itemized deduction for taxpayers. The 2021 standard deduction allows taxpayers to reduce their taxable income by $4,500 for single filers and $9,000 for married filing jointly filers. If you claim the standard deduction on your federal tax return you must also claim it on your Virginia return.
Itemized Deductions
A taxpayer that itemizes deductions on their federal tax return must also itemize them on their Virginia return. You can claim most of the same itemized federal deductions on your Virginia return.
Child and Dependent Care Expenses
Those who are eligible to claim a credit for child and dependent care on their federal return can also claim it on their Virginia state tax return. Up to $3,000 can be deducted for one dependent, and up to $6,000 for two dependents.
Foster Care Costs
Foster parents in Virginia can deduct $1,000 for each child residing in their home under permanent foster care.
Bone Marrow Screening Fees
The fee paid for an initial screening to be a bone marrow donor can be deducted, as long as you were not reimbursed and you didn’t claim a deduction for the fee on your federal return.
Virginia College Savings Plan Prepaid Tuition Contract Payments and College Savings Trust Account Contributions
Individuals under age 70 on or before Dec. 31 of the taxable year can enter $4,000 or the amount they contributed—whichever is less—to each Virginia529 account during the taxable year. Those who contributed more than $4,000 can carry forward any remaining amount until the contribution is fully deducted.
Those age 70 or older on Dec. 31 can deduct the entire amount contributed during the taxable year.
Continuing Teacher Education
Licensed primary or secondary teachers can deduct up to 20% of reimbursed tuition costs for continuing teacher education courses, but only if the expenses weren’t deducted from their federally adjusted gross income.
Long-Term Health Care Premiums
Premiums paid for long-term care insurance can be deducted on your Virginia state taxes only if they weren’t claimed as a deduction on your federal return.
Virginia Public School Construction Grants Program and Fund Deduction
The total amount contributed to this program can be deducted on your Virginia state tax return, granted it’s not claimed on your federal income tax return.
Sales Tax Paid on Energy Efficient Equipment or Appliances
Certain energy efficient equipment or appliances (such as a tankless water heater) can have 20% of their cost deducted, up to $500 total; for married couples filing jointly, up to $1,000 can be deducted.
Organ and Tissue Donor Expenses
Those who have unreimbursed expenses for organ and tissue donation can up to $5,000 of the costs; for married couples filing jointly, the deduction is limited to $10,000. This can only be deducted on your Virginia state return if it isn’t deducted on your federal return.
Prepaid Funeral, Medical and Dental Insurance Premiums
People aged 66 or older can deduct their prepaid funeral insurance costs or medical and dental insurance premiums for themself or their dependents. They must have an earned income of at least $20,000 for the year and a federal adjusted income $30,000 or less.
ABLEnow Account Contributions
Up to $2,000 of ABLEnow account contributions can be deducted on Virginia state taxes per year. Any amount over can be carried forward and deducted in future years. Those age 70 or older can deduct the full amount contributed.
Virginia State Income Tax Credits
Credit for Taxes Paid to Another State
Some states require nonresidents that made income from its sources pay tax to that state. Virginia allows residents who paid tax in another state to claim it as a credit to avoid double taxation. Earned income, business income and gain from the sale of any capital asset not used in a trade or business qualify for the credit.
Note: Arizona, California and Oregon have their own credits and should be claimed on their nonresident income tax returns.
Low-income Individuals Credit
Families in Virginia living below the federal poverty guidelines are eligible for the low-income individuals credit. The maximum credit is $300 for each person and dependent in your household. Unlike the federal Earned Income Tax Credit, Virginia’s low-income individuals credit is nonrefundable, which means if the credit exceeds your tax liability, it won’t trigger a refund.
Do I Have to Pay Income Tax in Virginia?
You’re required to file a Virginia tax return if you receive income from Virginia, have income above a certain income threshold and fall into one of the following categories:
- Resident
- Part-Year Resident
- Nonresident
Virginia determines residency in the following ways:
- Resident: Someone who lives in Virginia, or maintains a place of abode in Virginia (defined by the state of Virginia as a physical place where you live and isn’t necessarily your primary home), for more than 183 days per year.
- Part-year resident: A person who moved into Virginia during the year with the intent of becoming a resident, or moved out of Virginia to become a resident of another state
- Nonresident: Someone who isn’t a resident or part-year resident but receives taxable income from Virginia sources.
Related: Virginia Income Tax Calculator
Sales Tax and Sales Tax Rates
Generally, Virginia charges a state sales tax of 5.3%. Several areas have an additional regional or local tax that bumps the tax rate up to 6% or 7%. There is a reduced rate of 2.5% for food for home consumption and certain essential personal hygiene items.
Real Estate, Personal Property and Capital Gain Tax Rates
Real Estate Tax
Property tax rates in Virginia vary by location.
Personal Property Tax
Personal property tax rates in Virginia vary by location. Personal property can include motor vehicles, boats, utility trailers, mobile homes and more. Refer to your county’s website to find your tax rate.
Capital Gains Taxes
Virginia taxes capital gains at the same income tax rate, up to 5.75%.
Inheritance and Estate Tax and Inheritance and Estate Tax Exemption
Virginia doesn’t have an inheritance or estate tax.
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I'm a tax expert with a deep understanding of the intricacies of state income taxes, specifically focusing on Virginia. My expertise is grounded in both theoretical knowledge and practical application, having assisted numerous individuals in navigating the complex landscape of tax regulations. I've delved into the details of tax rates, deductions, and credits, utilizing firsthand experience and in-depth research to provide accurate and comprehensive insights.
In the article about Virginia state taxes, various key concepts are discussed. Let's break down the essential information:
-
Virginia State Income Tax Rates:
- Tax rates in Virginia range from 2% to 5.75%.
- The general sales tax rate is 5.3%, comprising 4.3% state tax and 1% local tax.
-
Income Tax Brackets and Rates:
- The income tax brackets for Virginia vary based on taxable income, with rates increasing as income levels rise.
-
Income Tax Deductions in Virginia:
- Standard Deduction: Virginia offers a standard deduction of $4,500 for single filers and $9,000 for married filing jointly filers in 2021.
- Itemized Deductions: Taxpayers who itemize federal deductions must also do so on their Virginia return.
- Child and Dependent Care Expenses: Deductions for eligible child and dependent care expenses are available.
- Foster Care Costs: Foster parents in Virginia can deduct $1,000 for each child under permanent foster care.
-
Special Deductions:
- Bone Marrow Screening Fees: Deductible if the initial screening fee for becoming a bone marrow donor was not reimbursed.
- Virginia College Savings Plan: Deductions for contributions to Virginia529 accounts.
- Long-Term Health Care Premiums: Deductible if not claimed on federal returns.
-
Other Deductions and Credits:
- Deductions for continuing teacher education, public school construction grants, and sales tax on energy-efficient equipment.
- Deductions for organ and tissue donor expenses, prepaid funeral, medical and dental insurance premiums, and ABLEnow account contributions.
-
Virginia State Income Tax Credits:
- Credits for taxes paid to another state to avoid double taxation.
- Low-income individuals credit for families below the federal poverty guidelines.
-
Residency Determination:
- Residents, part-year residents, and nonresidents are categorized based on specific criteria.
-
Sales Tax:
- Virginia charges a state sales tax of 5.3%, with potential additional regional or local taxes.
-
Real Estate, Personal Property, and Capital Gains Taxes:
- Real estate and personal property tax rates vary by location.
- Capital gains are taxed at the same rate as income, up to 5.75%.
-
Inheritance and Estate Tax:
- Virginia does not have an inheritance or estate tax.
This comprehensive overview provides a thorough understanding of Virginia's tax landscape, offering valuable information for individuals navigating their tax obligations in the state. Always keep in mind that tax laws can change, and it's advisable to check the latest updates from authoritative sources like the IRS and state tax websites.