DS30
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Investors & landlords

Unfortunately yes, you will need to file a nonresident tax return in VA if you need to recognize income from the recapture of depreciation on your rental on your federal income tax return.

Under VA tax law, there is no provision to subtract this recapture amount when you are calculating your VA source income.

For more information about this tax treatment in VA of recaptured depreciation, please refer to this VA tax court ruling on this subject:

http://www.tax.virginia.gov/laws-rules-decisions/rulings-tax-commissioner/95-109