The credit for taxes paid to another state is automatically calculated in your account when you add a Nonresident return to your already created resident Virginia return if you pay taxes to both Virginia and another state.
Virginia may request a copy of the other state's tax return before processing the return. Please see the Virginia Tax website for more information.
How do I enter this?
For Part-Year returns that have income taxed in Virginia and another state, you may be required to enter the information asked within your state program.
If you need to manually adjust your entry, visit
- State Section
- Virginia
- Credits
- Credit for taxes paid to another state
Since the credit for taxes paid to the other state is automatically calculated within the account, adjustments will need to be made to correctly calculate the state returns in reciprocal states.
What else do I need to know?
- If the income is from Arizona, California or Oregon, you must claim the credit on the nonresident return of that state instead of on the Virginia return.
- If the income is from District of Columbia, follow the DC instructions for receiving a refund of the tax paid.
- If you are a Virginia resident with wages, salaries and certain other compensation income earned as a nonresident in one of these four states, Kentucky, Maryland, Pennsylvania, or West Virginia you are not eligible to claim the credit for any income not taxable by the other state. If your wages, salaries and certain other compensation income are exempt, follow the other state’s instructions to obtain a refund of your withholding. A credit can be claimed on your Virginia return only for income taxes paid to any of the four states listed above on income that was not exempt income.
- Visit our Knowledgebase Article for detailed filing instructions for the resident and nonresident reciprocal state returns.
Border State Method
You may qualify for a special computation if you are required to file a return with Virginia and only one of the following states: Kentucky, Maryland, North Carolina, or West Virginia. The income from the border state must consist solely of wages and salaries or business income from Federal Schedule C, and your Virginia taxable income must be at least equal to the taxable income shown on the other state's return. We will automatically calculate this special credit when you enter the corresponding 2 letter abbreviation.