Virginia uses a progressive state income tax system with rates ranging from 2% to 5.75%. The top rate kicks in at a relatively low income threshold, meaning most full-time workers pay the top marginal rate on a portion of their income.
Virginia Tax Brackets
| Taxable Income | Tax Rate |
|---|---|
| $0 - $3,000 | 2% |
| $3,001 - $5,000 | 3% |
| $5,001 - $17,000 | 5% |
| Over $17,000 | 5.75% |
Virginia's brackets haven't been adjusted for inflation in decades. Most working Virginians reach the top 5.75% bracket. These figures are based on Virginia Department of Taxation guidelines.
What You'll See on Your Paystub
A Virginia worker's paystub includes both federal income tax withholding and state deductions:
| Deduction | Rate | Notes |
|---|---|---|
| Federal Income Tax | Varies | Based on W-4 and income |
| Social Security | 6.2% | Up to $181,200 wage base |
| Medicare | 1.45% | No wage limit |
| VA State Income Tax | 2% - 5.75% | Progressive based on income |
Virginia Standard Deduction
Virginia provides a standard deduction:
| Filing Status | Standard Deduction (2026) |
|---|---|
| Single | $8,000 |
| Married Filing Jointly | $16,000 |
Virginia's standard deduction is lower than the federal amount and many neighboring states. You may want to itemize deductions if you have significant mortgage interest or charitable contributions.
No Local Income Taxes (With Exceptions)
Most Virginia localities do not impose additional income taxes. However, some areas have special considerations:
- No general local income tax statewide
- Some special tax districts exist for transportation funding
- Hampton Roads Transportation District: additional 0.7% sales tax (not income tax)
Northern Virginia Workers
Northern Virginia (NOVA) is home to the DC metro area workforce:
- Many federal government employees and contractors
- High concentration of tech companies (Amazon HQ2, many defense contractors)
- High cost of living but also high salaries
- Many workers commute to DC or Maryland
DC Metro Considerations
Virginia has a reciprocity agreement with DC and Maryland:
- Live in VA, work in DC: Pay VA taxes only (file DC form to claim exemption)
- Live in VA, work in MD: Pay VA taxes only (file MD form to claim exemption)
- Live in DC, work in VA: Pay DC taxes only
- Live in MD, work in VA: Pay MD taxes only
The DC-MD-VA reciprocity agreement simplifies taxes for the millions who live in one jurisdiction and work in another. You only pay taxes to your state of residence.
Hampton Roads Workers
The Hampton Roads region has a strong military and maritime presence:
- Norfolk Naval Station is the world's largest naval base
- Newport News Shipbuilding is a major employer
- Significant defense contractor presence
- Tourism sector in Virginia Beach
Richmond Metro Workers
The state capital offers diverse employment:
- State government headquarters
- Growing tech and finance sectors
- Healthcare systems (VCU Health, Bon Secours)
- No city income tax
Military Personnel
Virginia is home to numerous military installations:
- Active duty military pay follows residence-based taxation
- Military members can claim residence in their home state
- Virginia does not tax military retirement pay (effective 2022)
- Major bases: Norfolk, Fort Liberty (NC border), Pentagon
Virginia fully exempts military retirement pay from state income tax, a significant benefit compared to many states.
Federal Employees
With proximity to Washington DC, many Virginians are federal employees:
- Federal civilian pay is fully taxable
- FERS pension distributions are taxable
- TSP withdrawals are taxable
- Federal employees living in VA and working in DC only file VA returns
Retirement Income
Virginia's retirement income taxation:
- Social Security benefits are fully exempt
- Age 65+ deduction: up to $12,000 per person
- Military retirement: fully exempt
- Other retirement income: taxable at regular rates
Virginia vs. Neighboring States
| State | Tax Structure | Top Rate |
|---|---|---|
| Virginia | Progressive | 5.75% |
| Maryland | Progressive + Local | 5.75% + local |
| DC | Progressive | 10.75% |
| North Carolina | Flat | 4.5% |
| West Virginia | Progressive | 5.12% |
| Tennessee | None | 0% |
Virginia's top rate is competitive with Maryland's state rate, but Maryland adds local income taxes of 2.25% to 3.2% on top. DC has much higher top rates for high earners.
Comparing Take-Home Pay
Here's how a $100,000 annual salary compares in the DC metro area:
| State | Effective Rate | Annual State/Local Tax |
|---|---|---|
| Virginia | ~5.3% | ~$5,300 |
| Maryland (Montgomery Co.) | ~7.5% | ~$7,500 |
| DC | ~6.8% | ~$6,800 |
Virginia generally offers lower income taxes than Maryland or DC, which is one reason Northern Virginia has seen significant population and job growth.
Key Takeaways
- Virginia's top rate of 5.75% applies to most working adults (kicks in at $17,000)
- Reciprocity with DC and Maryland means you only pay taxes where you live
- Military retirement pay is fully exempt
- Social Security benefits are fully exempt
- Lower overall tax burden than neighboring Maryland or DC