Is Virginia a Piggyback State?

Virginia Income Tax Rate 2020

Virginia state income tax rate table for the 2020 – 2021 filing season has four income tax brackets with VA tax rates of 2%, 3%, 5%, and 5.75%.

State Returns and Virginia Specifics

State returns typically “piggyback” off the federal return. However, if that’s not possible, having some extra time to file your Virginia return can help.

Virginia State Information

  • Virginia is the 20th healthiest state in America.
  • Virginia ranked 16th for affordability, 11th for quality of life, and 11th for access to healthcare. However, its overall score was higher than any other state, earning it the top spot.

Tax Payment and Reciprocity

Where do I pay taxes if I live in Virginia and work in North Carolina? You will also pay tax on your North Carolina sourced income as a nonresident for income earned in the state. However, your resident state of Virginia will give you a credit of tax paid to another state (North Carolina) so you are not double-taxed.

Do I have to pay Virginia state taxes if I live in another state?

The first estimated tax payment for Virginia Income Tax is due May 1. Please mail the estimated payment to the Commissioner of the Revenue, PO Box 175, Spotsylvania, VA 22553-0175. The remaining payments should be mailed to the Treasurer of Spotsylvania County, P.O. Box 65, Spotsylvania, VA 22553. You always have to file in your home state if required. However, Maryland and Virginia have an agreement that allows you to only file in the resident state instead of both states if you only had income from working in Virginia.

If you live in a state that does not have a reciprocity agreement with the state you work in, you will simply file taxes following each state’s reporting requirements. You will receive a tax credit from your residence state for the taxes you paid in the work state.

When you live in one state and work in another, you will have to pay out-of-state taxes. At the end of the year, you will file two returns – a nonresident return in the work state, and a resident return in your home state.

Congress passed a law in 2015 that forbids double taxation. You won’t be taxed twice on the same money even if you file in multiple states.

If you worked in Bristol, Virginia, and lived in Bristol, Tennessee, you would pay Virginia nonresident state income taxes.

If you qualify for the reciprocal agreement between Virginia and another state, you will need to remove the automatic state tax calculation and file returns in both states – Virginia resident and nonresident reciprocal.

Seven states don’t have income taxes: Alaska, Florida, Nevada, South Dakota, Texas, Washington, Wyoming. So you may not need to pay taxes if working temporarily in those states.

Higher income earners in Virginia pay a higher tax rate, so the more you make, the higher percentage of tax you pay.

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