Tax Type
Individual Income Tax
Description
Taxes paid by residents to other states; Capital gain on disposition of real property
Topic
Credits
Date Issued
12-27-1995
December 27, 1995
Re: Request for Ruling: Individual Income Tax
Dear******************
This will reply to your letter of October 10, 1995, in which you request a ruling as to the applicability of the Virginia out-of-state tax credit to your client,************** (the "Taxpayer" ) .
FACTS
The Taxpayer is a resident of Virginia who sold real property located in Connecticut during 1995. For the past 30 years, the property has been used as a summer vacation home by the Taxpayer and her family. Connecticut imposes a tax on the capital gain from the sale of the property, and does not allow an out-of-state tax credit because the Taxpayer is a resident of Virginia. You request a ruling as to whether Virginia will allow an out-of-state tax credit for the tax paid to Connecticut.
RULING
Code of Virginia § 58.1-332 (A) provides in part:
-
- Whenever a Virginia resident has become liable to another state for income tax on any earned or business income... for the taxable year... (Emphasis added)
- Whenever a Virginia resident has become liable to another state for income tax on any earned or business income... for the taxable year... (Emphasis added)
-
- Earned income shall mean wages, salaries, or professional fees and other amounts received as compensation for professional services actually rendered . . . (Emphasis added)
Business income shall mean income derived from an activity which constitutes a "business" for federal income tax purposes for which a federal Schedule C, E, or F must be filed... (Emphasis added)
- Earned income shall mean wages, salaries, or professional fees and other amounts received as compensation for professional services actually rendered . . . (Emphasis added)
If you have any questions regarding this ruling, you may contact *****at****************.
Sincerely,
Danny M. Payne
Tax Commissioner
OTP/10660P
Rulings of the Tax Commissioner