I live in Virginia but work for government in DC. Do I still need to file a DC state tax return?

[ckulmacz]

Hi! I have a unique scenario:

My employer and office is in VA. For the first half of the year (from Jan 1, 2019 to June 30, 2019) I lived in Virginia. Then I moved to DC July 1, 2019 but continued to work in VA. Also, my employer didn't inform me that I had to file the VA-4 to be exempt from VA income tax until I already received three paychecks (so I was paying both VA and DC income taxes for a month and a half). I know I'll have to claim a credit on my tax return (indicating the amount I had to pay in VA taxes while a DC resident before the VA-4 form was filed).

However, the bigger issue I'm having is how to file the state tax return. Since I was a Virginia resident for less than 183 days (183 days would have been July 3, 2019) does that make me a nonresident for VA or am I a part-year resident? And then I'm assuming for DC I would simply be a part-year resident, correct?

Additionally, on my W2, both state's wages are listed. However, the wages for VA list my entire year's wages (let's say $100) while the wages for DC only list the amount I earned while I was a DC resident (let's say $60). So when I'm filing for Virginia should I put the wages as only the wages earned while a VA resident (per the example, this would be $100-$60 = $40) or do I put exactly what's on the W2 as the entire year's wages ($100)? And then for DC, I'm assuming I indicate the amount listed on my W2 ($60) not $0, even though my office was always in VA, correct?

[TomD8]

@ckulmacz  --  For tax year 2019, you are a part-year resident of VA and a part-year resident of DC.  VA can tax all the income earned during your period of VA residency; DC can tax all the income earned during your period of DC residency.

The 183-day rule does not apply to your situation.  You became a DC resident (and ceased being a VA resident) on the day you established your new domicile in DC.  Your domicile  is your main, permanent home. 

The 183-day rule applies to those who are domiciled in another state and in VA (or DC) for temporary purposes, such as school.

Once you established your DC domicile, your income ceased being subject to VA taxation, assuming you commuted every day to VA and received only wage or salary income in VA.

You "established" your DC domicile on the day you began living in your new home in DC.  (Temporary lodging such as a hotel doesn't count.)

[ravello96]

I live in Virginia and work for Federal Government in DC, and for part of 2019 DC withheld taxes from me.  In doing Turbotax  for Virginia I see no reference to this in tax return for Virginia.  How do I get that DC withholding credited to DC, or get the DC withholding refunded to me?

[TomD8]

@ravello96  - If you were not a resident of DC in 2019, you do not need to file a DC tax return.

File DC Form D-40B in order to obtain a refund of the incorrectly withheld DC taxes.  Here's a link:

https://otr.cfo.dc.gov/node/1450551

[Jbflynavy]

@nera I just had my first paycheck in a new job (where I work in DC and live in VA).  Payroll sent the majority of my state tax to DC and only sent a very small amount to VA.  Based on your comment about reciprocal state taxes and only needing to file in VA,… (1) should any $ at all be coming out of my paycheck for DC taxes?   (2) does a reciprocal state tax mean I will only realistically pay VA state tax level(~5%) or DC level (~8%) or some combo in between?

[TomD8]

@Jbflynavy :

Only DC residents are subject to DC income tax.

Submit DC Form D-4A to your employer ASAP.  Here's a link to that form:

https://otr.cfo.dc.gov/sites/default/files/dc/sites/otr/publication/attachments/48019_2015_D-4A.pdf

Your income is 100% taxable by your home state of VA.