Income Tax Questions
What is the function of the local Commissioner of the Revenue's Office in the processing of 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 immediately entered on the Commissioner of the Revenue’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. All accelerated refunds 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 Isle of Wight County 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. Long-distance telephone calls to Richmond do not have to be made.
All Isle of Wight County 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.
What is the deadline to file my Virginia Income Tax Return?
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.
All taxpayers are granted an automatic 6 month extension to file their income tax returns. No application for extension is required; however, any tentative tax due must be paid with an extension voucher, Form 760IP, by the original due date for filing the return, May 1st.
Do I need to file a return?
Virginia individual income tax applies to income received from Virginia sources by Resident and Nonresident individuals. A return must be filed if you received Virginia source income, and meet the Department of Taxation filing requirements. Please click on the link below for requirement information.
As a member of the Armed Forces, am I required to file a Virginia return?
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.
What am I required to attach to my Virginia State Income Tax Return?
Every Resident return (Form 760), must include a complete copy of each Federal Schedule C, C-EZ, D, E or F, filed with your Federal return, and all other schedules and forms supporting gross receipts and depreciation. Nonresident (Form 763) and Part-year(Form 760PY) returns must include a copy of the Federal Form 1040, 1040A, or 1040EZ, as well as all the requirements for the Resident return. You are also required to attach all W-2, W-2G, or 1099 Forms, showing Virginia income tax withheld.
What is the rate for Virginia individual income taxes?
If Your Taxable Income is:
But Not Over
Your Tax is
Of Excess Over
|$3,000||$5,000||$60 + 3%||$3,000|
|$17,000||---||$720 + 5.75%||$17,000|
Is there a penalty if I file late?
There are two types of penalty: Late Filing Penalty and Extension Penalty. You would owe a penalty for late filing if your return shows a balance due and the return was filed after the due date. This penalty would be 6% per month or portion of the month the return is late. If you submitted an extension to file, and the tax owed when filed exceeds the tax liability by 10%, a penalty for understating the tentative tax on your extension request will be added at the rate of « of 1 percent per month, or part of the month from the date of filing or extension due date, whichever comes first.
Would I also owe interest if I am filing late?
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.
Who is a resident?
There are two classes of residents: domiciliary and actual. Domiciliary residents are those whose legal domicile is Virginia. Most domiciliary residents actually live in Virginia. Actual residents are those who have their place of abode in Virginia for more than 183 days of the taxable year, even though their domiciliary residence is in another state or country (this usually pertains to students, and spouses of military personnel). Domiciliary and actual residents for the full year file on Form 760 and 760S.
Who is a Part-year resident?
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.
Who is a Nonresident?
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.
What is Estimated Tax?
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 1st, June 15th, September 15th, and January 15th of the following tax year.
What tax breaks are available to Taxpayers who are 65 and over?
If you or your spouse reached the age of 65 on January 1st of the filing season, you may qualify to claim an age deduction.
If your birth date was on or before January 1, 1939, you may claim an age deduction of $12,000. If filing a joint return and both spouses were born on or before this date, each spouse would claim a $12,000 are deduction.
If you were born after January 1, 1939, your age deduction is based on your income. Please complete this worksheet to calculate your deduction: Age Deduction Worksheet
Virginia also allows an additional exemption of $800 for every taxpayer over the age of 65.
If I need income tax forms or assistance who would I contact?
Available at the local Commissioner of the Revenue’s Office are tax forms as well as a trained staff to assist you with any questions you may have about filing. 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. The local staff can answer questions and serve as a liaison for Isle of Wight citizens having problems dealing with correspondence received from the Virginia Department of Taxation.