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camsmitty
Level 1

I live in DC but work in VA. Is it possible to choose which state to file taxes through the reciprocity?

I currently live in DC and work in VA, but have DC taxes withheld by my employer. Is it possible to file my taxes at the end of the year in VA, pay VA what I owe, and request a refund for my DC taxes paid with each paycheck during the year?

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Accepted Solutions
maglib
Level 10

I live in DC but work in VA. Is it possible to choose which state to file taxes through the reciprocity?

Sorry you pay taxes to the state you live in no matter what. Reciprocal tax agreement just means you don't pay to the state you work in.  Depending your income.  DC income tax rates seem higher.  The difference is not huge though.  

 

Washington, D.C., levies income taxes from residents utilizing 5 tax brackets. 4% on the first $10,000 of taxable income. 6% on taxable income between $10,001 and $40,000. 8.5% on taxable income between $60,001 and $350,000.

 

The state of Virginia has a progressive income tax, with rates ranging from 2% to a top rate of 5.75%.

Virginia’s income tax rates are assessed over 4 tax brackets:

  • 2% on the first $3,000 of taxable income.
  • 3% on taxable income between $3,001 and $5,000.
  • 5% on taxable income between $5,001 and $17,000.
  • 5.75% on taxable income of $17,001 and above.

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2 Replies
maglib
Level 10

I live in DC but work in VA. Is it possible to choose which state to file taxes through the reciprocity?

Sorry you pay taxes to the state you live in no matter what. Reciprocal tax agreement just means you don't pay to the state you work in.  Depending your income.  DC income tax rates seem higher.  The difference is not huge though.  

 

Washington, D.C., levies income taxes from residents utilizing 5 tax brackets. 4% on the first $10,000 of taxable income. 6% on taxable income between $10,001 and $40,000. 8.5% on taxable income between $60,001 and $350,000.

 

The state of Virginia has a progressive income tax, with rates ranging from 2% to a top rate of 5.75%.

Virginia’s income tax rates are assessed over 4 tax brackets:

  • 2% on the first $3,000 of taxable income.
  • 3% on taxable income between $3,001 and $5,000.
  • 5% on taxable income between $5,001 and $17,000.
  • 5.75% on taxable income of $17,001 and above.

View solution in original post

TomD8
Level 15

I live in DC but work in VA. Is it possible to choose which state to file taxes through the reciprocity?

Reciprocity does NOT allow you to pick and choose the state to which you owe taxes.  State laws apply.

 

DC residents who are taxed in their home state, commute to Virginia every day, and receive only wage or salary income in Virginia are exempt from taxation in Virginia.  https://www.tax.virginia.gov/reciprocity

 

If you are a resident of DC, accept employment in Virginia, and meet the criteria for exemption, complete Form VA-4 to certify your exemption and give the form to your employer. You will need to re-certify your exemption every year.  https://www.tax.virginia.gov/sites/default/files/taxforms/withholding/any/va-4-any.pdf

 

As @maglib  explained, if you are a resident of DC, your income is taxable by DC. 

**Answers are correct to the best of my ability but do not constitute tax or legal advice.
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