Virginia has a reciprocal agreement with District of Columbia, Kentucky, Maryland, Pennsylvania and West Virginia if the only source of income is from wages and salaries.
If the taxpayers employer withheld tax or the taxpayer paid tax to these states on their compensation, they must claim a refund from that state. The Taxpayer may not claim a credit on Schedule CR for that tax withheld by the employer. File the appropriate forms with that state to receive a refund of tax withheld in error.
If the other state is Washington DC:
- Add or Edit Nonresident DC return
- Basic Information
- Enter State abbreviation for your domiciliary or legal state of residency
To claim exempt from future withholdings, file form D-4A with the taxpayers employer.
If the other state is Kentucky:
- Add or Edit Nonresident Kentucky Return
- Basic Information
- Residency Information - Complete the questions indicting the taxpayer is a resident of a reciprocal state
- Form 740-NP-R - Complete for the taxpayer and one for the spouse (if applicable)
To claim exempt from Kentucky withholdings in the future, file form 42A809 with the taxpayers employer.
If the other state is Maryland:
- Add or Edit Nonresident Maryland Return
- Basic Information
- Residency Information - Complete the questions as they pertain to the taxpayers resident state
- Was Maryland tax withheld in error from your Maryland income? If this is answered yes, then no tax will be calculated and you will receive a refund for all of the withholding
To claim exempt from future Maryland withholdings, complete form MW507 and file it with the taxpayers employer.
If the other state is Pennsylvania:
- Add or Edit Nonresident PA return
- Adjustments to Income
- Reciprocal State Wage Adjustment - Enter the wages as a negative number
Pennsylvania requires proof that taxes were paid to the other state. Print and mail the PA return along with a copy of the Virginia state return, the W-2(s) with the PA income and a statement explaining the taxpayer is a resident of a reciprocal state. To claim exempt from future PA withholdings, file form REV-419 with the taxpayers employer.
If the other state is West Virginia:
- Add or Edit Nonresident West Virginia Return
- Basic Information
- Special Nonresident Income for Reciprocal States
To claim exempt from future withholdings, complete form WV/IT-104 and file it with the taxpayers employer.
Note: On its resident tax return, Virginia does not provide a credit for double-taxed income in Arizona, California, the District of Columbia, and Oregon. A Virginia resident filing a nonresident tax return with one of those states or DC must claim a credit for taxes paid to Virginia on the nonresident return.
Additional Information: