Virginia does impose a tax on retirement income. However, you can take an Age Deduction of up to $12,000, if you qualify. The age deduction depends on your age, filing status, and income.
How is the subtraction calculated?
If you or your spouse was born on or before January 1, 1960, you may claim a deduction of up to $12,000 for 2024. If your birth date is:
- On or before January 1, 1939: You may claim an age deduction of $12,000. If you are married, each spouse born on or before January 1, 1939, may claim a $12,000 age deduction. For individuals born after January 1, 1939, the age deduction is based on the criteria below.
- On or between January 2, 1939, and January 1,1960: Age deduction is based on your income. To determine the age-deduction, a taxpayer’s income is the taxpayer’s adjusted federal adjusted gross income (AFAGI). AFAGI is the taxpayer’s federal adjusted gross income, modified for any fixed date conformity adjustments and reduced by any taxable Social Security and Tier 1 Railroad Benefits.
For single taxpayers, the maximum allowable age deduction of $12,000 is reduced dollar for dollar for the amount the taxpayer’s AFAGI exceeds $50,000. For all married taxpayers, the maximum allowable age deduction of $12,000 each is reduced dollar for dollar for any amount that the joint AFAGI exceeds $75,000.
Note for All Married Taxpayers: A married taxpayer’s income-based age deduction is always determined using the married taxpayers’ joint AFAGI. Regardless of whether filing jointly or separately. If both spouses are claiming an income-based age deduction, regardless of whether filing jointly or separately, the married taxpayers must compute a joint age deduction first, then allocate half of the joint deduction to each spouse.