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You might work in Washington DC but live in Virginia; or you might live in another state but own a rental house in Vienna. Do you need to pay state taxes? The rules are complicated, and if you make a mistake, you may be wondering what you did wrong.
Our skilled tax attorneys understand the nuances of federal, international, and state tax laws, and could help you comply before there is a problem to remedy. Even if you have been notified that you owe Virginia back taxes, a Vienna state and local tax lawyer is ready to investigate and steer the situation away from penalties.
The Virginia Department of Taxation oversees all tax matters in the Commonwealth, including billing, collections, audits, investigations, and levying sanctions. The people who work for the Department are bound by a Taxpayer Bill of Rights to treat taxpayers with courtesy and professionalism. The Department is also the agency overseeing any taxpayer rebate authorized by the Virginia General Assembly.
Residents of other states may have to pay Virginia income tax in certain situations, such as for the sale of residential or commercial property. The Department of Taxation recognizes residents, part-time residents, and some non-residents as contributors to the state’s tax base. The requirement to file is based on whether the person filed a federal tax return and how much their adjusted gross income was: currently the Virginia Adjusted Gross Income (VAGI) threshold is $11,900 for single filers and $23,900 for joint filers. This income must be generated in Virginia, whether the earner is a resident or not.
Full-time residents are domiciled in Virginia for at least 183 days a year. Part-time residents are those domiciled in Virginia less than 183 days a year, including new residents who moved to Vienna in the second half of the year. If income is generated in the Commonwealth prior to residency, taxes are owed along with income generated while a resident. Non-residents owe taxes if their business interests generate income in Virginia, though there are exceptions.
The Commonwealth of Virginia recognizes reciprocity for residents who work outside of state lines. Vienna residents who work in DC, but do not live there, are exempt from DC income taxes, which are instead paid to Virginia. However, Virginia residents may still be responsible for paying the District of Columbia Unincorporated Business Franchise Tax. Virginia also has reciprocity with Kentucky, Maryland, Pennsylvania, and West Virginia.
A Vienna taxpayer who feels they are being wrongly penalized for not filing a DC tax return should consult an attorney to clarify their obligations.
It is not uncommon to make a mistake when you are filing taxes, especially when you are a Vienna resident who works in the District or has only lived here for less than half a year. Most of these errors can be corrected quickly – but if you have more than $50,000 at issue, legal assistance is highly recommended.
If the Virginia Department of Taxation is conducting an audit or imposing penalties, Pontius Tax Law could provide value by assessing your tax situation and determining the best way address it administratively. Call today to schedule a consultation with a Vienna state and local tax lawyer.
Pontius Tax Law, PLLC is a tax law firm that strives to resolve sensitive tax problems through trust, dedication and value. The law firm was founded by John Pontius with offices in Washington, DC, Rockville, MD, Bethesda, MD, Fairfax, VA, and Alexandria, VA. Mr. Pontius represents individual and business clients with sensitive and serious tax matters before the Internal Revenue Service and state taxing authorities. His client base is local, national, and international.
Over the course of his career, Mr. Pontius has represented businesses and individuals with complex tax issues in the following areas: FBAR examinations, offshore and domestic disclosures, FATCA, FIRPTA, tax planning, unfiled tax returns, release of tax liens and levies, trust fund recovery penalty, IRS and state audit examinations, as well as appeals, penalty abatement, U.S. Tax Court litigation, along with defense of tax fraud and evasion. If you require assistance from a tax lawyer, contact Mr. Pontius to discuss your situation.
