In Virginia, there are 4 tax brackets with rates of 2%, 3%, 5%, and 5.75%. How much you pay depends on your income and residency. The top rate of 5.75% starts at $17,000 in taxable income, affecting most taxpayers. Virginia state tax brackets and income tax rates depend on taxable income and residency status.
| Tax rate | Taxable income bracket | Tax owed |
| 2% | $0 to $3,000. | 2% of taxable income. |
| 3% | $3,001 to $5,000. | $60 plus 3% of the amount over $3,000. |
| 5% | $5,001 to $17,000. | $120 plus 5% of the amount over $5,000. |
| 5.75% | $17,001 and up. | $720 plus 5.75% of the amount over $17,000. |
In Virginia, your tax bill depends on your residency status – there are 3 types. This status determines what part of your income the state will tax
Resident Status Rules
To be considered a resident of Virginia for tax purposes, you must spend 183 or more days in the state during the tax year or have a “place of abode” there. Examples of resident status include spending more than 183 days in VA, being a VA college student, or having a VA resident spouse. Check the Virginia Department of Taxation for full residency rules.
Part-Year Resident Status Rules
You are a part-year resident of Virginia if you only lived there for part of the year. This often happens to people who moved to Virginia from another state. You have to pay Virginia state tax on all the money you earned while you were living there. You also have to pay tax on the money you earned from Virginia while you were living somewhere else. To report this, you use Form 760-PY.
Non-Resident Status Rules
If you live outside Virginia but make money from Virginia sources, you may still need to pay taxes to the state. This includes income from working in Virginia, renting property, selling property, or running a business in Virginia. Meaning, You might have to file a tax return with Virginia even though you don’t live there.
Virginia Sales Tax
In Virginia, shopping just got a little sweeter with a sales tax of only 5.3%! This includes a base rate of 4.3% and a local rate of 1%. Some areas, like Northern Virginia, Central Virginia and Hampton Roads, add an extra 0.7% sales tax, making the total 6%. In Halifax County, the tax is 6.3% due to an extra 1% tax. In the Historic Triangle, the tax is 7% because of a 1.7% local tax.
Alcohol, tobacco, food, hygiene products, and plants for food have a lower sales tax rate of 2.5%. Most medicines are tax-free.
And here’s the cherry on top – in August, there’s a sales tax holiday for items like hurricane gear, generators, clothes, school supplies, and eco-friendly products.
Virginia Property Tax
The property tax in Virginia is 0.75% on average, which is the 21st lowest in the US. This means that people in Virginia pay 0.75% of their home value in property taxes each year. However, the rate can vary depending on where you live, as it’s assessed and collected by local county and city governments. If you want to refinance your home or buy a new one, check out our guide for mortgage rates in each county of Virginia.
Virginia Estate Tax
In Virginia, the estate tax was abolished on July 1, 2007. This means that for people who died after that date, their estate does not have to file an estate tax return.
Virginia Capital Gains Tax
In Virginia, capital gains are taxed as regular income and are likely to be taxed at the highest rate of 5.75%.
Virginia Gas Tax
In Virginia, the state tax on regular gas is 28 cents per gallon, which is the 24th lowest in the US. The state tax on diesel gas is 28.9 cents per gallon.
You have until May 1, 2023, to file your 2022 individual income taxes in Virginia. And if you need a little more time, the state has got you covered with an automatic extension option until November 1.
Just remember, taking an extension doesn’t mean you can take more time to pay, it just means more time to file your return. If you want to avoid any late fees or interest, make sure to pay your estimated tax bill by the original deadline.
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