If you are a resident of Virginia, but have income from North Carolina, then you will need to file tax returns for both states. There is not a reciprocity agreement in place with these states.
You will file a Virginia resident tax return and claim a tax credit for taxes paid to North Carolina.
You will file a non-resident North Carolina return to report the income that was earned in North Carolina.
After finishing your Federal return, you should complete the non-resident (NC) return first and then your resident (VA) return.
edited 2/8/16 5:11 am PST to change order of state completion
ehhhh watch it........Backwards
After Federal is full filled out.....everything but not yet filed.
.....NC nonresident must be prepared first....only then work thru the VA resident tax return.
Thanks for the catch (I misread my list of exceptions). Editing my answer now.
So does this mean you will essentially be paying income taxes in both NC and VA??
No, you are not double taxed. You will pay tax on all of your income in Virginia if you are a resident of Virginia. You will also pay tax on your North Carolina sourced income as a nonresident for income earned in the state. However, your resident state of Virginia will give you a credit of tax paid to another state (North Carolina) so you are not double-taxed.
For more information, please see Credit for Taxes Paid to Another State.
@adangelico91