2027 Virginia state tax guide
2027 Virginia Tax Changes: confirmed deductions, credits, and filing paths
Virginia locked in several 2027 anchors: a higher standard deduction of $9,200 for single filers and $18,400 for married filing jointly, a refundable EITC option that continues, fixed federal conformity, new collection-process relief beginning July 1, 2027, and a permanent PTET election. This guide sorts confirmed changes from still‑pending ideas.
Need to compare years? Review the 2026 Virginia Tax Changes Guide for the prior-year rules and planning context.
Use current state releases to confirm final 2027 forms, tables, and instructions before filing or making a tax decision.
Connected 2027 guide library
Start with the 2027 tax question that fits your next decision.
Use these official-source categories to verify updates and instructions as filing season approaches. They provide the most current explanations of enacted changes, worksheets, and practical steps for individuals, pass‑through owners, and businesses operating in Virginia.
Core answer
Virginia’s 2026 Legislative Summary settles several 2027 questions. For taxable years beginning January 1, 2027 and before January 1, 2028, the standard deduction is $9,200 for single filers and $18,400 for married couples filing jointly. The summary also confirms a refundable earned income tax credit remains available through 2029, adopts a fixed date for federal Internal Revenue Code conformity, starts new wage‑garnishment and Virginia currently‑not‑collectible provisions on July 1, 2027, and makes the pass‑through entity tax (PTET) election permanent. Together, these items frame 2027 filing paths for households and businesses. Use the confirmed standard deduction versus potential Virginia itemized deductions, check eligibility for the refundable EITC, and, for owners of pass‑throughs, weigh whether a PTET election fits your situation. Keep federal and Virginia treatments separate: the fixed conformity date may create timing differences. Proposals not enacted—such as changes to individual rates or new surtaxes—are outside this guide. We focus only on changes Virginia has confirmed.
What Virginia has confirmed to change for taxable year 2027
Virginia’s 2026 Legislative Summary confirms a key 2027 anchor: for taxable years beginning January 1, 2027 and before January 1, 2028, the standard deduction is $9,200 for single filers and $18,400 for married couples filing jointly. This single‑year specification is unusually concrete and should be the first figure households note when weighing whether to itemize on the Virginia return. Because the amounts apply based on when the taxable year begins, calendars that straddle fiscal years should confirm which year’s rule governs. Keep the figure distinct from any federal standard deduction; the federal amount may differ. Use Virginia’s number directly in state planning worksheets and withholding or estimated‑payment checkups.
Alongside the standard deduction, the 2026 Legislative Summary extends the refundable earned income tax credit option through 2029, which means the refundable feature is in place for 2027 filings. Refundability matters for cash‑flow planning because it allows eligible filers to receive credit amounts that exceed Virginia tax due as a refund. Eligibility and calculation details are governed by Virginia individual income tax instructions and are generally connected to a federal earned income credit claim. Because refundability is confirmed beyond 2027, families can evaluate work hours, withholding, and advance decisions knowing the state credit will retain this feature. Revisit withholding choices after major income or family changes and retain documentation the Virginia return will require.
The Legislative Summary also confirms that Virginia uses a fixed Internal Revenue Code conformity date for 2027. A fixed date means the state ties its tax base to the federal code as it existed on a specific date, rather than adopting later federal changes automatically. If Congress adjusts deductions, credits, or expensing after that date, Virginia may not reflect those changes for the 2027 state return unless the General Assembly later updates conformity. That can create timing differences between federal and state calculations. When preparing year‑end plans, review Virginia individual income tax resources and instructions for any listed additions, subtractions, or worksheets that reconcile federal figures to Virginia’s fixed‑date rules.
New taxpayer‑assistance procedures also arrive mid‑year. Effective July 1, 2027, the Legislative Summary establishes provisions addressing wage‑garnishment processes and a Virginia currently‑not‑collectible (CNC) status. CNC is an administrative pause on collection activity for taxpayers who qualify based on financial condition, allowing time for stabilization and communication with Virginia Tax. Garnishment provisions clarify how wages may be addressed within the state’s collection framework beginning on that date. Households with older balances should review options before July 1 to understand documentation needs and contact pathways. After the date, those seeking relief can discuss CNC screening, updated payment plans, and documentation requests directly with Virginia Tax using the channels it provides.
Finally, the summary makes Virginia’s pass‑through entity tax (PTET) election permanent. For owners of partnerships and S corporations, that permanence reduces year‑to‑year uncertainty and supports multi‑year planning for entity‑level payments, distributions, and owner cash needs. PTET can shift income tax on Virginia‑sourced pass‑through income to the entity level for federal purposes, which some owners use to manage interactions with federal limitations. Because the election is now permanent, owners can formalize procedures for timing, documentation, and owner communications. Importantly, the Legislative Summary does not enact changes to individual income‑tax rates or a new investment surtax for 2027. Treat such proposals, if discussed elsewhere, as pending and outside current law.
Standard deduction, refundable EITC, and individual filing decisions
When setting a 2027 filing path, start with Virginia’s confirmed standard deduction—$9,200 for single filers and $18,400 for married filing jointly—for taxable years beginning in 2027. Compare that figure to what your Virginia itemized deductions might total. Because Virginia’s rules do not automatically mirror every federal deduction, consult Virginia individual income tax instructions to determine which expenses qualify and how they are entered. Many households will run both calculations early: a state‑specific itemized estimate and the fixed 2027 standard deduction. If the standard deduction is larger, planning often shifts toward simplifying records; if itemized deductions appear higher, organize receipts and statements early so you can substantiate amounts on the Virginia return.
Filing status shapes Virginia outcomes. The Legislative Summary confirms the married filing jointly standard deduction for 2027, which highlights how status can change the baseline deduction available. If you are married, consider how a joint versus separate state filing choice interacts with wage withholding, Virginia credits you expect to claim, and your documentation workload. Some households coordinate withholding to better match the expected Virginia deduction and credit landscape for the year. Others prioritize timing of refunds. Before changing a filing approach, review Virginia individual income tax instructions for status rules and the consequences of different choices, then align your records and forms—such as wage statements and information returns—accordingly.
Refundable EITC availability through 2029 gives eligible households a steadier planning horizon for 2027. Because Virginia’s credit is connected to the federal earned income credit framework, start by confirming your federal eligibility and the figure shown on your federal return. Then turn to Virginia individual income tax resources for the state calculation, any required schedules, and refundability details. Refundability means that, if you qualify, the credit can exceed what you owe and be paid out, which can influence paycheck withholding settings during the year. Keep documentation that supports your earned income and qualifying family information, as Virginia return preparation will reference it when computing the state credit.
With the standard deduction fixed for 2027, wage earners can review Virginia withholding allowances and supplemental withholding requests earlier in the year. Self‑employed filers and retirees can revisit estimated‑payment patterns to reflect the deduction and any expected credits. If you anticipate claiming the refundable EITC, model scenarios that reflect different work hours or seasonal income to avoid large swings at filing time. Remember that Virginia’s withholding and estimated‑payment systems are separate from federal; adjust each on its own schedule. Keep copies of pay statements, Form W‑2s, and any Virginia withholding statements, since those documents help reconcile the amounts withheld to what appears on your state return.
Life events still control many 2027 decisions. A marriage, separation, birth, or move can change filing status, eligibility for credits such as the refundable EITC, and whether itemizing might surpass the standard deduction. Update employer forms and payer instructions as soon as circumstances shift so Virginia withholding reflects your new path. If you run a side business, revisit how income and expenses will appear on your Virginia return and whether they affect your credit profile. Keep notes of the dates changes occurred; timing can matter when a deduction or credit depends on your situation during the taxable year that begins in 2027.
Fixed IRC conformity, deductions, business expensing, and federal-return connections
Virginia’s fixed Internal Revenue Code conformity means the state pegs its references to federal law as of a set date. For 2027 returns, this approach provides clarity up front but may require adjustments if federal law changes afterward. For example, if Congress alters a deduction, extends an expiring provision, or modifies a credit after Virginia’s conformity date, the federal return may reflect a rule that Virginia has not yet adopted for 2027. In that case, your Virginia return will follow the state’s fixed‑date rules, often using Virginia worksheets to adjust from federal figures. Keep both sets of instructions open when preparing projections.
Itemized deductions are an area where fixed conformity can matter. If your federal return includes items affected by late‑year federal changes—such as charitable deductions, medical expenses, or educator‑related costs—verify whether Virginia’s fixed‑date references include those specific changes for 2027. If not, Virginia instructions may require an addition, subtraction, or alternative computation to align with the state base. Because Virginia publishes worksheets to help reconcile these differences, seek the most recent state guidance before finalizing. When in doubt, prepare a side‑by‑side: list the federal itemized amounts you expect, then mark any items that the Virginia instructions identify as treated differently for the 2027 taxable year.
Business owners should review expensing and depreciation carefully under fixed conformity. If the federal return benefits from provisions that were changed after Virginia’s conformity date, the Virginia return may not match. That could affect how you plan purchases, place assets in service, or time repairs. Check Virginia individual income tax instructions and Virginia Tax news for any clarifications on 2027 worksheets that reconcile federal depreciation, amortization, or related adjustments. Keep detailed asset records—dates placed in service, cost, method, and recovery period—so you can compute any Virginia‑specific differences efficiently. Coordinate with your pass‑through entity as well, since owner‑level Virginia adjustments may flow from entity‑level schedules.
Although Virginia’s starting point often references the federal return, treat the two returns as separate projects. Prepare the federal return first for a clean baseline, then import only the pieces Virginia instructions ask for. A fixed conformity date means not every new federal worksheet or statement will carry over for 2027, even if it helps your federal result. Keep a folder with federal schedules that Virginia references directly, and a second folder for schedules that are informative but not used in the state calculation. This organization will reduce rework when you encounter a Virginia addition, subtraction, or state‑specific schedule during preparation.
Planning under fixed conformity is about sequencing and documentation. Early in the year, review Virginia Tax news for any guidance that interprets the Legislative Summary’s fixed‑date framework for 2027. Midyear, if federal legislation passes, make a quick note describing the change and flag whether Virginia has addressed it. Before year‑end, build a Virginia‑only projection that starts with your latest federal draft but swaps in state‑specific assumptions. Finally, after forms are released, confirm that your software or worksheets are using the correct Virginia instructions for 2027 and not defaulting to assumptions from a prior year with different conformity rules.
Virginia tax-debt relief, wage garnishment, and currently-not-collectible pathways
Virginia’s 2026 Legislative Summary confirms two 2027 collection‑process updates: wage‑garnishment provisions and a Virginia currently‑not‑collectible (CNC) status, both effective July 1, 2027. These updates give taxpayers and Virginia Tax clearer options to address unpaid balances. If you have an older balance, note the date and gather recent financial information so you can discuss options promptly once the provisions are in effect. The goal is to match a realistic payment approach to your current ability to pay, or, if warranted, to pause collection through a CNC determination. Staying proactive with documentation and contact helps reduce stress and supports better outcomes.
Wage‑garnishment provisions taking effect July 1, 2027, frame how wages may be addressed within state collection processes after that date. If your employer receives a notice, keep communication open with both your employer and Virginia Tax so amounts are applied correctly. If your situation changes—such as a loss of hours or new essential expenses—contact Virginia Tax to discuss whether an adjustment or alternative arrangement is available. Keep pay stubs, bank statements, and proof of essential living costs, as those documents often help explain your situation. If a balance remains after garnishment activity, ask for a written summary so you can plan next steps.
CNC status, beginning July 1, 2027, is designed for taxpayers who cannot make payments without hardship. A CNC determination pauses active collection while you stabilize finances and share updated information. To explore CNC, prepare a simple budget, gather proof of income and necessary expenses, and list any dependents and medical or caregiving obligations. When you contact Virginia Tax, ask what documents support a CNC review and how often you should check in. If your finances improve, Virginia Tax may revisit CNC and discuss a payment plan. Keep copies of all letters and notes of phone calls so you can reference details later.
Communication can prevent misunderstandings once the 2027 provisions begin. If you receive a notice, read it carefully and note any response options. If you are working with a representative, make sure Virginia Tax has authorization on file so conversations flow smoothly. When proposing a payment plan, be conservative so you can sustain the payments; it is better to start with something you can maintain. If you think CNC is appropriate, say so early and ask how to document need. Confirm mailing addresses, online account access, and preferred contact methods so you do not miss updates about your account.
Build a 2027 calendar that reflects the July 1 start date. In the spring, gather documents and outline your preferred approach—payment plan, CNC, or another route. In June, confirm Virginia Tax contact channels and prepare questions. In July, make the first call on or after the effective date to ensure your options reflect the new provisions. After you reach an arrangement, set reminders to review your budget quarterly. If your finances change, reach out quickly rather than falling behind. Keeping a written timeline of contacts and agreements will help you stay organized throughout the process.
PTET, local sales layers, business records, and payment decisions
Virginia’s Legislative Summary makes the pass‑through entity tax (PTET) election permanent, removing the uncertainty that can complicate multi‑year business plans. For partnerships and S corporations, permanence supports a consistent process: decide annually whether to elect, estimate the entity‑level payment, assess cash needs for distributions, and prepare owner communications. Because PTET operates at the entity level, owners should coordinate with their preparers to understand how the election affects owner‑level Virginia credits or additions and how it interacts with federal return planning. With permanence in place, draft a standing PTET calendar that assigns responsibilities for election timing, payment scheduling, and document retention.
Owners should evaluate PTET within a broader year‑round plan. Consider your expected Virginia‑source income, residency mix, and whether owners can benefit from entity‑level payments for federal purposes. Compare a PTET year to a non‑PTET year using last year’s schedules as a template, then adjust for 2027 expectations. Coordinate with lenders or investors if covenants or agreements reference after‑tax cash flow, since entity‑level payments can affect distributions. Keep in mind that PTET is now permanent; if you skip the election in one year, you can still revisit it in a later year without relying on temporary authorization. Document owner votes or consents according to your governing documents.
Separate from income taxes, Virginia businesses face state and local sales and use tax layers. While this guide does not present local rates, it is important to recognize that local decisions can change a seller’s collection and filing footprint. If you make sales across multiple localities in Virginia, confirm which jurisdictions you have to report to and how invoices should show tax. Marketplace facilitators and remote sellers should review Virginia Tax news and guidance to understand collection responsibilities and filing methods. Keep a current list of ship‑to locations, taxability decisions for your products or services, and the tools you use to compute sales tax.
Thorough records make 2027 easier. For PTET, retain election confirmations, payment receipts, owner allocation schedules, and correspondence shared with owners. For sales and use tax, keep exemption certificates, customer resale documentation, taxability memos, and transaction listings that show the jurisdiction and amount of tax charged or accrued. For income taxes, maintain K‑1s, depreciation schedules, and Virginia adjustments provided by the entity. Use consistent naming conventions and a secure folder structure so documents are easy to share with owners and preparers. Before year‑end, run a records gap check to confirm you can trace amounts from source documents to returns.
Payment timing matters. Entities that expect to elect PTET can align estimated payments with expected income patterns to avoid large year‑end cash needs. Owners should coordinate personal estimated payments with entity‑level decisions so total cash paid to Virginia aligns with projections. For sales and use tax, set recurring calendar reminders keyed to your filing frequency, and review whether your changing sales mix suggests a different filing cadence. If a cash crunch develops, contact Virginia Tax early to discuss options for both entity and owner accounts. Clear, early communication helps prevent surprises and supports steady operations.
Connect Virginia state facts to the federal 2027 tax decision that comes next
After assembling Virginia’s 2027 facts—standard deduction, refundable EITC, fixed conformity, July 1 collection‑process updates, and permanent PTET—place them beside your federal plan. Start with a clean federal projection so you know your expected income, deductions, and credits under federal law. Then mark which items flow directly to Virginia and which do not because of the fixed conformity date. This side‑by‑side view highlights where a state tactic (such as PTET) or a federal tactic (such as timing a deduction) has the larger effect. Finish by deciding which actions you will complete now and which you will revisit after year‑end forms are available.
For households, the immediate Virginia decision is whether the fixed 2027 standard deduction will likely exceed your Virginia itemized deductions. Next, if you may qualify for the refundable EITC, confirm federal eligibility and plan your recordkeeping early. Review Virginia withholding in light of both decisions. Finally, consider whether any federal changes enacted late in the year will affect Virginia for 2027 under fixed conformity; if not, build a small cushion into your savings in case the returns diverge. Keep a short checklist: standard deduction vs itemizing, EITC records, withholding update, document folder, and a reminder to check Virginia Tax news.
Pass‑through owners should add a PTET decision checkpoint to their 2027 federal checklist. Prepare two projections: with and without PTET, reflecting Virginia‑source income and owner residency. Coordinate with payroll and distribution planning to ensure cash is available for entity‑level payments if you elect PTET. Confirm how the entity will report owner‑level Virginia information so owners can complete their state returns smoothly. Because PTET is now permanent, you can stage these steps at the same time each year, improving consistency. Keep an owner communication memo that explains the election decision, expected payments, and any owner action items tied to the state return.
Businesses that collect Virginia sales and use tax should connect their state checklist to federal operations planning. Inventory systems, invoicing, and cash flow all intersect with tax collection and remittance. As your 2027 product mix or sales channels change, retest your taxability assumptions for Virginia. If you begin selling into new Virginia localities, add those jurisdictions to your returns and confirm your software or worksheets handle them correctly. Track customer exemption documentation expiration dates. On the federal side, confirm that sales‑tax‑related accounting does not inadvertently affect federal income recognition or expense categorization in your general ledger.
Close the loop with a final joint review. In late fall, refresh your federal projection, then update the Virginia view using the Legislative Summary’s confirmed items. If Congress passes changes after Virginia’s conformity date, note those and flag any Virginia additions or subtractions you may need. Recheck the refundable EITC plan, and, for owners, reconfirm the PTET decision and payments. Enter the Virginia standard deduction and other confirmed items into your planning file so you are not hunting for numbers during filing season. This structured review keeps Virginia’s 2027 anchors front and center as you finalize actions.
Verify with primary sources
Official sources to monitor
This guide relies on official Virginia sources: the Virginia 2026 Legislative Summary for enacted 2027 changes, Virginia individual income tax resources for calculation details and instructions, and Virginia Tax news for updates that explain how the summary is implemented across returns, payments, and taxpayer‑assistance processes.