Registration Requirements in Virginia 

Most businesses with activity in Virginia are required to register with Virginia Tax. Some businesses are also required to register with the State Corporation Commission. The State of Virginia has a guide you can follow, found here

S-Corporation Income Tax

Virginia recognizes the federal S-election, and Virginia S corporations are not required to pay tax to the state. However, individual S corporation shareholders will owe tax on their share of the corporation’s income

LLC/Partnership Income Tax

LLCs and partnerships are not required to pay income tax to Virginia. Instead, income from the business is distributed to individual LLC members or partners, who then pay Virginia income tax on that amount with their personal return.

Pass Through Entity Tax

Pass through entities doing business in Virginia are required to file a Virginia pass through entity tax return on Virginia Form 502.

Composite Tax

Pass through entities that have 2 or more nonresident individual owners may file a composite nonresident individual income tax return on behalf of its qualified nonresident owners who wish to participate. 

Individual Income Tax

Individual income tax varies by taxable income and filing status. Tax rate schedules are as follows.

Due Dates

Returns are due on the 15th day of the fourth month following the close of the tax year. For most taxpayers, returns are due on April 15th. 

Estimated Payments

Individuals who can expect their tax liability at the end of the tax year to exceed $150 will generally be required to make estimated payments. 

Filing an Extension 

Pass through entities and individuals will be automatically granted a 6 month extension. The extension does not apply for the payment of any tax due. 

Penalties

Virginia returns filed more than 6 months after the due date with a balance due will be subject to  a late filing penalty. This penalty is assessed at a rate of 6% per month up to a maximum of 30%.

Additional Information

Pass-through entities, including S corporations, LLCs, general partnerships, limited partnerships (LPs), and limited liability partnerships (LLPs), that do business in, or receive income from, Virginia must file a tax return (Form 502) for information purposes even though no tax may be due

If your business was formed or is located in another state, but generates income in Virginia, it may be subject to Virginia taxes. The rules for taxation of multistate businesses, including what constitutes nexus with a state for the purpose of various taxes, are complicated. If you run such a business, you should consult with a tax professional.

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