How to File Virginia Form 760PY for Part-Year Residents

Filing taxes as a part-year resident in Virginia requires attention to detail, particularly when completing Form 760PY. This form is for individuals who moved into or out of the state during the tax year and must report income earned while residing in Virginia. Properly filing ensures compliance with state tax laws and helps maximize potential benefits.

Residency Criteria and Filing Thresholds

Virginia defines a part-year resident as someone who moved into or out of the state during the tax year. This status determines the portion of income subject to Virginia state tax. Residency is established using a domicile test that considers factors such as the location of a permanent home, place of employment, and voter registration.

For the 2024 tax year, part-year residents must file a Virginia tax return if their Virginia Adjusted Gross Income (VAGI) exceeds $11,950 for single filers or $23,900 for married couples filing jointly. These thresholds, which differ from those for full-year residents, are adjusted annually.

Allocating Income for Part-Year

Only income earned during Virginia residency is subject to state tax, making accurate income allocation essential. This requires distinguishing income earned in Virginia from income earned elsewhere. Maintain detailed records like pay stubs, bank statements, and employment contracts to determine income sources and applicable tax jurisdictions.

For instance, if you moved to Virginia on July 1, only income earned from that date through December 31 is taxable in Virginia. Additionally, income from Virginia-based sources, such as rental income, must be reported even if earned while not a resident.

Joint income, such as from a jointly owned business, must be apportioned based on the period of residency. For example, if a business generated $100,000 in income over the year and you were a Virginia resident for six months, allocate $50,000 to Virginia.

Deductions and Credits

Deductions and credits are key tools for reducing taxable income and liability. Virginia offers prorated personal exemptions and standard deductions for part-year residents. For 2024, the personal exemption is $930 per person, prorated based on the duration of residency. The standard deduction is $4,500 for single filers and $9,000 for married couples filing jointly, also prorated.

Credits can further reduce tax liability. The Credit for Low-Income Individuals benefits those with income below specific thresholds and may result in a refund. The Credit for Taxes Paid to Another State prevents double taxation on income earned and taxed by another state during non-residency periods.

Documentation for Submission

Proper documentation is essential when submitting Form 760PY. Gather proof of income, such as W-2s and 1099s, to support income allocation. These documents help the Virginia Department of Taxation verify reported figures.

Maintain records supporting deductions and credits, including receipts for eligible expenses. If claiming the Credit for Taxes Paid to Another State, include copies of other states’ tax returns as proof. Accurate documentation minimizes delays and reduces the risk of audits.

Payment and Refund Details

Timely payment of additional taxes prevents penalties and interest. Payments can be made electronically through the Virginia Department of Taxation’s eForms system or by mailing a check or money order with the completed return. Include the payment voucher (Form 760-PMT) to ensure proper processing. Late payments incur a penalty of 6% per month, capped at 30%, plus interest based on the federal short-term rate plus 2%.

Refunds are typically processed faster with direct deposit: within four weeks for electronic returns and up to eight weeks for paper filings. Use the “Where’s My Refund?” tool on the Virginia Department of Taxation website to track refund status. Ensure all documentation is accurate to avoid delays.

After Filing Steps

After submitting Form 760PY, retain copies of your return, payment records, and supporting documentation for at least three years, as required by Virginia law. This ensures compliance with the statute of limitations for tax assessments.

Monitor your account for any correspondence from the Virginia Department of Taxation and respond promptly to prevent penalties or prolonged audits. If you discover an error on your return, file an amended return using Form 760PY within three years to claim additional refunds or adjust liabilities.