Article: 50458

Overview 

If you are a Virginia resident who earned income in another U.S. state, and that income was taxed by that other state, you may be eligible to claim the Credit for Taxes Paid to Another State. This prevents double taxation of the same income on both the Virginia return and the other state’s return. 

Who Can Claim This Credit? 

You may qualify if: 

• You are a full-year resident of Virginia, 

• You filed a return with another state and paid tax on income that is also taxable by Virginia, 

• The income is not exempted from taxation by Virginia (e.g., certain types of income covered by reciprocity agreements or exclusions), 

• The other state does not offer reciprocal credit. 

Note: This credit is only for individual state-level income taxes not local taxes, franchise taxes, or excise taxes. 

What’s Included in the Credit? 

You may claim credit for the lesser of: 

1. The actual tax liability paid to the other state on qualifying income, 

2. The Virginia tax is attributable to that same income. 

If both spouses had out-of-state income taxed elsewhere, the credit must be calculated separately for each. 

How to Report 

1. Navigate to the State Taxes section on the left-hand side of the screen. 

2. Click the link: I’d like to see the forms I’ve filled out or search for a form.

3. In the dropdown menu, select Virginia. 

4. Click on the Credits tab. 

5. Click on Credit for Tax Paid to Another State to open the form. 

6. Enter all applicable information.  

7. Click Save once complete. 

Additional Resources 

 For further information see:  https://www.tax.virginia.gov/sites/default/files/vatax-pdf/2024-760-instructions.pdf