Virginia Enacts Tax Changes in Budget Bill

first_imgThe Virginia biennial budget bill enacts changes to both corporate and individual taxes, affecting credits and deductions.Historic Preservation Tax CreditAfter 2016, the historic rehabilitation tax credit amount that may be claimed cannot exceed $5 million for any tax year. This includes amounts carried over from prior years.Land Preservation Tax CreditFor tax years after 2016 and before 2020, the land preservation tax credit amount cannot exceed $20,000. This includes amounts carried over from prior years.Deduction for ABLE Act ContributionsTaxpayers are allowed a deduction for the amount contributed to an ABLE savings trust account entered into with the Virginia College Savings Plan. No deduction will be permitted if the contributions are also deducted on the contributor’s federal income tax return.The individual deduction for contributions is limited to $2,000 per ABLE savings trust account. If the contribution to an ABLE savings trust account is more than $2,000, the remainder may be carried forward. Excess contributions can be subtracted in future tax years until the contribution has been fully deducted. However, if the contributor is 70 years or older, they may deduct the entire amount contributed.Retaliatory Costs to Other States CreditThe amount deposited to the Priority Transportation Trust Fund must not be reduced by more than $266,667 by any refund of the tax credit for retaliatory costs to other states.Subscribers can view the text of the bill at 2 (H.B. 5002), Laws 2018, First Special Session, effective July 1, 2018, except as notedLogin to read more tax news on CCH® AnswerConnect or CCH® Intelliconnect®.Not a subscriber? Sign up for a free trial or contact us for a representative.last_img

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