Several new state and local tax laws go into effect beginning July 1. Some of the highlights include:
Conformity refers to how closely Virginia follows definitions and other provisions of the federal tax code, most importantly, the definition of adjusted gross income. The 2023 General Assembly passed legislation that conforms Virginia’s tax law to the federal tax code on a rolling basis, with certain exceptions. The legislation also sets guidelines for future federal law changes that Virginia law would not conform to.
The General Assembly has made changes that modify our payment plan program, including a 5-year installment plan for individuals. To set one up, visit Payment Plans.
Firearm Safety Device Tax Credit
Beginning this year, if you purchase certain types of firearms safety devices, you may be eligible for an income tax credit of up to $300 ($600 if you file jointly with your spouse and you each submit a separate application). We can only issue a total of $5 million in Firearm Safety Device credits per year, and will allocate them on a first come, first served basis. We will begin accepting applications for the credit later this year. In the meantime, if you purchase one of these devices this year, be sure to save your receipt.
Sales Tax Exemption for Diagnostic Work and Emergency Roadside Service
Beginning July 1, amounts separately charged for labor rendered in connection with diagnostic work for automotive repair and emergency roadside service for motor vehicles will be exempt from Virginia’s sales tax, regardless of whether there is a sale of a repair or replacement part or a shop supply charge.
For more information and a complete list of 2023 state and local tax legislation, please see the 2023 Legislative Summary.