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Am i eligible for an out of state tax credit on my Virginia individual income tax return, if i have worked in Tennessee this year?

filling out a W-4 for a new job in another state
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2 Replies
rjs
Level 15
Level 15

Am i eligible for an out of state tax credit on my Virginia individual income tax return, if i have worked in Tennessee this year?

Tennessee has no personal income tax, so there is nothing to get a credit for. You will not pay any tax to Tennessee.


Your post is a little unclear. What state do you live in? In what year or years did you work in Tennessee? What state is "another state" where your new job is? Will you be working in that state in 2023?

 

Hal_Al
Level 15

Am i eligible for an out of state tax credit on my Virginia individual income tax return, if i have worked in Tennessee this year?

Q.  Am i eligible for an out of state tax credit on my Virginia individual income tax return, if i have worked in Tennessee this year?

A. Simple answer: No.

 

The general rule is: your report all your income on your home state return, even the income earned out of state. You file a non-resident state return for the state you worked in and pay tax to that state. Your home state will give you a credit, or partial credit, for the tax you paid the non-resident state.

 

When you worked in a state without an income tax (e.g. Tennessee, Texas or Florida), there will be no credit, since there was no income tax paid to that state.  In other words, having worked in a state without an income tax does not get you out of paying state tax, on that income, to your home state.

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