For tax year 2026, West Virginia made several notable updates that taxpayers should be aware of. These changes affect income exclusions, deductions, credits, and documentation requirements.
Social Security Benefits
Social Security benefits are now fully exempt from West Virginia income tax. If your Social Security benefits were included in your federal adjusted gross income, you can subtract 100% of those benefits on your West Virginia return.
Qualified Opportunity Zone Modification Restored
The Qualified Opportunity Zone modification has been restored for qualifying taxpayers. This deduction is available for taxable years beginning on or after January 1, 2024, and remains available for 2026 filers who meet the requirements.
Deductions
A new deduction is available for independent contractors who contribute to a qualified Voluntary Portable Benefits Plan. Eligible contributions that were not deductible federally may be claimed as a West Virginia subtraction modification. Supporting documentation is required.
Credits
Pass-through entity owners who receive an EK-1 can now claim the Elective Income Credit on the Tax Credit Recap Schedule for tax paid by the pass-through entity. A copy of the EK-1 must be provided with the return.
Municipal Use Tax
Additional West Virginia municipalities now impose a municipal use tax. Taxpayers making purchases where sales tax was not collected should review local use tax requirements when completing Schedule UT.