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State Income Tax - Frequently Asked Questions
- What is the function of the Commissioner of the Revenue's Office in processing state individual income tax returns?
- What is the Deadline to file my Virginia State Income Tax Return?
- Do I need to file a return?
- As a member of the Armed Forces, am I required to file a Virginia return?
- What am I required to attach to my Virginia State Income Tax Return?
- What is the Rate for Virginia individual income taxes?
- Is there a Penalty if I file late?
- Would I also owe Interest if I am filing late?
- Who is a Resident?
- Who is a Part-Year resident?
- Who is a Nonresident?
- What is Estimated Tax?
- What Tax Breaks are available to taxpayers who are 65 and over?
- If I need income tax forms or assistance who would I contact?
1. What is the function of the Commissioner of the Revenue's Office in processing state individual income tax returns?
The main function is to screen, review, and process all incoming tax returns. A local filing helps to ensure that the return will be accurate, in composition and mathematics, before being sent to the Department of Taxation in Richmond.
Upon receipt, locally filed tax returns are processed and immediately entered on the Commissioner's Office computer system, allowing quick access for inquiries and the ability to send it back to the taxpayer for correction if necessary. An automated tracking system enables us to quickly inform the citizen at what stage of processing their return is located. Refund returns are processed daily through an on-line computer link with the Virginia Department of Taxation. Tax due payments and initial estimated income tax payments are posted and transmitted to the Chesapeake Treasurer for deposit.
Accessibility is another advantage of locally filed returns. Besides the greater speed in processing of a taxpayer's return, filing locally makes it more convenient for our staff to personally interact with the citizen or tax preparer to correct any errors that have been made. If citizens do not receive their state income tax refunds within an expected time frame, they can contact their local Commissioner's Office and speak with a trained staff member regarding the delay. Advice can be rendered as to how best to correct any problems and speed the refund along.
All Chesapeake citizens are encouraged to utilize the services and resources offered by the Commissioner of the Revenue's Office. State income taxes can often be confusing so it is very beneficial when knowledgeable assistance is close at hand.
You should file your return as soon as possible after January 1, but not later than May 1. If the due date falls on a Saturday, Sunday or legal holiday, you may file your return on the next business day.
Virginia law provides an automatic six-month filing extension for income tax returns. No application for extension is required. The extension is for filing the return not for payment of the tax; therefore, you must pay at least 90 percent of your tax by the due date, May 1. To make a payment of tentative tax, use Form 760IP.
Virginia individual income tax applies to income received from all sources for Residents and Virginia sources for Nonresident individuals. A return must be filed if you received Virginia source income and meet the following general requirements:
- are required to file a federal income tax return;
- are single with income in excess of $11,950; or
- are married filing jointly with combined income in excess of $23,900; or
- are married filing separately with income in excess of $11,950.
If you are domiciled in Virginia, you are liable for income tax on your active duty military pay as well as any other income received regardless of whether or not the income was from Virginia sources. A credit is given for income taxes paid to most states. You would file on the 760 Resident form. If you are not a domiciliary resident of Virginia, you are taxed in Virginia on income from Virginia sources, including income from property owned or from any business, trade, profession or occupation carried on during the period you were in Virginia. You would file on Form 763.
The Department of Taxation is using imaging equipment that allows returns to be processed more efficiently. Enclose the original Virginia Forms 760, Schedule ADJ, Schedule OSC, and Schedule CR. Do not send photocopies of these forms. Photocopies of any other supporting documents are acceptable. Please assemble your return in the following order: Form 760, Schedule ADJ, Schedule OSC, Schedule CR, Federal Schedule E and F (if necessary).
Nonresident (Form 763) and Part-Year (Form 760PY) returns must include a complete copy of the Federal Form 1040, 1040A, or 1040EZ, as well as all other required Virginia attachments. You are also required to attach all W-2 and 1099 forms, showing Virginia tax withheld with a single staple at the left center of page 1 of the return.
If your Virginia taxable income is not over $3,000, the tax is 2% of your Virginia taxable income. If your income is higher, the following rates apply:
|INCOME OVER||BUT NOT OVER||YOUR TAX IS||OF EXCESS OVER|
|$ 3,000||$ 5,000||$ 60 + 3%||$ 3,000|
|$ 5,000||$ 17,000||$120 + 5%||$ 5,000|
|$ 17,000||$ 720 + 5.75%||$ 17,000|
You would owe a penalty for late filing if your return shows a balance due and the return was filed after the extension period ends; you must compute a late filing penalty of 30 percent of the tax due with your return.
If you file your return within six months after the due date, and the tax owed is more than 10 percent of your total tax liability, you must compute an extension penalty on the balance of tax due. The extension penalty is applied at the rate of two percent per month, or part of the month, from the due date through the date your return is filed.
Whether you filed with or without an extension, interest would be accrued from the filing due date, through the date the return is filed. Interest is calculated on the balance due at a daily rate, established in accordance with Section 58.1-15 of the Code of Virginia. The daily rate is usually 2% over the Federal "underpayment rate". With on-line computer access to the Department of Taxation in Richmond, the Commissioner of the Revenue's Office is able to calculate penalty and interest owed on current and prior year returns.
There are two classes of residents: domiciliary and actual. If you have established legal domicile in Virginia, you are a domiciliary resident until you establish legal domicile in another state. Members of the armed forces who claim Virginia as their home of record are domiciliary residents even if stationed outside of Virginia. A domiciliary resident who accepts employment outside of Virginia or outside the United States but does not abandon Virginia as a domiciliary resident remains a domiciliary resident, even if outside of Virginia for many years.
You are an actual resident if you maintained an abode in Virginia, or were physically present for more than 183 total days during the taxable year, even if you are a domiciliary resident of another state or country.
- Active Duty Military Personnel: If you are a domiciliary (legal) resident of another state and you have Virginia source income you may be required to file a Form 763, Non-resident Income Tax Return.
- Active Duty Military Spouse: Federal legislation signed into law on November 11, 2009, the Military Spouses Residency Relief Act, affects Virginia income tax filing requirements for certain spouses of military personnel. Effective for taxable year 2009, spouses of military service members do not automatically become Virginia residents for purposes of income and personal property taxation in cases where the individual is present in Virginia solely to be with a spouse who is a member of the military serving in Virginia in compliance with military orders. You may be able to file Form 763-S, Virginia Special Non-resident Claim for Individual Income Tax Withheld.
If you moved into Virginia and became a resident during the taxable year, you are taxed as a resident for only that part of the year you were a resident. If you moved out of Virginia and became a legal resident of another state on or before the last day of the taxable year, you are taxable as a Virginia resident for only that part of the year you were a resident of Virginia. Part-year residents file on Form 760PY. If all of the individual's income is from Virginia sources, he or she may elect to file as a full-year resident on Form 760.
If you are neither a domiciliary nor an actual resident, then you are taxable as a nonresident on any income you received from labor performed, business done, or property located in Virginia. If you were a domiciliary or actual resident of Virginia during a part of the taxable year and taxed as a Part-year resident, you are still liable as a nonresident for any Virginia source income derived from property owned or from any business, trade, profession or occupation carried on during the period you were not a resident of Virginia. Nonresidents file on Form 763.
If you have income from sources other than wages, on which Virginia income tax is not withheld and your estimated Virginia tax liability exceeds your tax credits by more than $150, you must file and pay Estimated Taxes Quarterly on Form 760ES. At least 90% of your tax liability for the year must be paid by withholding and/or timely installment payments of estimated taxes. The due dates for Virginia Estimated tax payments are May 1, June 15, September 15, and January 15 of the following tax year.
Individuals who are 65 or over before January 1 may qualify to claim an age deduction based on birth date, filing status and income. The maximum age deduction of $12,000 will be subject to income limitations, based on the individual's adjusted federal adjusted gross income. The age deduction will be reduced by one dollar for each dollar that the adjusted federal adjusted gross income exceeds $50,000 for single filers or $75,000 (combined total) for married individuals filing joint or separate returns.
Married taxpayer's income based deduction is always determined using the married taxpayers' joint adjusted federal adjusted gross income. Regardless of whether you are filing jointly or separately, if you are married, your income-based age deduction is determined using both your and your spouse's income.
Our local staff can answer questions and serve as a liaison for Chesapeake citizens having problems dealing with correspondence received from the Virginia Department of Taxation. In addition, by bringing a copy of your completed Federal Income Tax Return, you can receive free assistance in preparing your State Income Tax Return.
Commissioner of the Revenue
P.O. Box 15285
Chesapeake, VA 23328
Virginia State Department of Taxation
804-367-8031 – Customer Service
804-440-2541 – to Order Forms
Internal Revenue Service
800-829-1040 – Customer Service
800-829-3676 – to Order Forms