Virginia 2025 Limited itemized deduction worksheet

[MindyB]

The Virginia 2025 Limited Itemized Deduction Worksheet is used because Virginia is one of the states that do not follow the federal tax rules for itemized deductions. As one example, Virginia uses a stricter 10% income floor for medical deductions on this worksheet, whereas the federal return uses a 7.5% floor.  If you want more information see the instructions on page 2 of the form: 2025 Virginia Schedule A Itemized Deductions  

[user17724008297]

Didn't answer the question.  Question was about the Virginia "Limited Itemized Deduction Worksheet" that is used to compute your itemized deduction limitation.   Line 1 of that form says "Enter the total amount from Virginia Schedule A, Lines 4, 5a, 5b, 5c, 6, 10, 14, 15, and 16c".  The form downloaded from the Virginia tax site makes no mention of a SALT cap on Line 5a.  However, the same worksheet filled out by TurboTax applies a $10,000 Cap on line 5a (says Line 5a is not to exceed $10,000 for a joint return).  The question is, should Line 5a on this form have a $10,000 SALT cap or not?

[BillM223]

Yes, Itemized Deductions on the Virginia return should use the $10,000 (MFJ) cap on State and Local Taxes (SALT). The 2025 Instructions for Schedule A state:

Virginia SALT Cap Amount: At the time these instructions were printed, the Virginia SALT deduction cap remained limited to $5,000 if married, filing separately and $10,000 for all other taxpayers. The above Virginia SALT cap amounts must be used wherever the SALT cap is referenced in these instructions unless the Virginia General Assembly enacts legislation to change the Virginia SALT cap amounts.

In addition, the Instructions state:

Information about any changes that may be made by the Virginia General Assembly will be posted on the Department’s website at www.tax.virginia.gov.

The form may not make a mention of the $10,000 (MFJ) SALT Cap Amount, but the instructions devote a full paragraph to it (above).

I do not see a bulletin from the Virginia Tax authority noting that the Virginia Legislature has changed the SALT Cap Amount, only the "Pease" limitation.

[wkatb]

There was an update done for Virginia and I am wondering if the update is now doing it wrong. On line 1 of the Virginia Limited Itemized deduction worksheet, it says line 5a should not exceed $40,000 for MFJ. But should that amount mirror what deduction you were allowed on your federal return?

[LenaH]

No. On Schedule A, the full amount of SALT is entered on 5a. Then, on line 5e, the lesser of the total or $40,000 ($20,000 if married filing separately) is entered. This is different from the Virginia Schedule A, which limits Line 5a to the Virginia SALT cap amount. 

In addition, if your income exceeds the threshold of $399,200 for married filing joint ($332,700 if filing single), your itemized deductions are restricted and you must use the Limited Itemized Deduction Worksheet to computer your itemized deduction limitation amount. 

@wkatb