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Category: West Virginia

West Virginia Credit for Taxes Paid to Another State

West Virginia Residents may be eligible to claim a credit for income taxes paid to another state on income derived from sources within that state. The purpose of this credit is to prevent dual taxation of such income.

Part-Year Residents may only claim credit for taxes paid to another state during their period of West Virginia residency.

Nonresidents are not entitled to a Schedule E credit under any circumstances.

Limitations:

The amount of a Schedule E credit is subject to the following limitations:

  • The credit cannot exceed the amount of tax payable to the other state on income also subject to West Virginia Tax. This is the amount of income tax computed on the nonresident return filed with the other state.
  • The credit cannot exceed the percentage of the West Virginia tax determined by dividing the portion of the taxpayer's West Virginia income subject to taxation in another state by the total amount of the taxpayer's West Virginia income.
  • The credit cannot reduce the West Virginia tax due to an amount less than what would have been due if the income subject to taxation by the other state was excluded from the taxpayer's West Virginia income.

You cannot claim this credit if you are a resident of KY, MD, OH, PA, or VA unless your source income is other than wages and/or salaries and unemployment compensation.

You may claim credit on your West Virginia Resident Income Tax Return for state income tax paid, as a nonresident, to ONLY the following states:

 

Alabama

IndianaNew Hampshire
ArizonaIowaNew Jersey
ArkansasKansasNew Mexico
CaliforniaLouisianaNew York
ColoradoMaineNorth Carolina
ConnecticutMassachusettsNorth Dakota
DelawareMichiganOklahoma
District of ColumbiaMinnesotaOregon
GeorgiaMississippiRhode Island
HawaiiMissouriSouth Carolina
IdahoMontanaUtah
IllinoisNebraskaVermont
  Wisconsin

 

**NOTE: THE LIST ABOVE IS SUBJECT TO CHANGE AT ANY TIME***

Special Instructions for Residents of:

Kentucky, Maryland, or Ohio: If your income during 2013 was from wages and/or salaries only, you may not claim a Schedule E credit. In order to receive a refund of the erroneously withheld tax, you must file a return with the state in which taxes were withheld. If you had income from a source other than wages and/or salaries, you are allowed a credit for income taxes paid by completing Schedule E. You must maintain a copy of the other state tax return in your files.

Pennsylvania or Virginia: If you income during 2013 was from wages and/or salaries only, you may not claim a Schedule E credit. In order to receive a refund of the erroneously withheld tax, you must file a return with these states. If you spend more than 183 days in one of these state and are considered an actual resident for tax purposes, or it you had income from a source other than wages and/or salaries, you are allowed credit for income taxes paid to the commonwealth of Pennsylvania or Virginia by completing Schedule E. You must maintain a copy of the other state tax return in your files.

Special Note: You may be relieved from having another state's income tax withheld from your wages. Contact your employer or the other state's taxing authority for additional information.