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VA P.D. 09-176 General Provisions 2009-11-12

What initial Virginia tax relief did Tax Bulletin 09-10 announce for qualifying military spouses in 2009?

Short answer: The initial bulletin said a spouse accompanying a service member under military orders could avoid gaining or losing domicile when both shared the same domicile and the spouse was present solely to accompany the member. Qualifying 2009 Virginia service income could be exempt, 2009 refunds could be claimed beginning January 1, 2010, and a revised Form VA-4 could stop withholding. A spouse's vehicles and tangible property received the same treatment as the service member's. Virginia promised a later bulletin with implementation details.

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This page answers the general question as of 2009. Ezel answers yours, under current Virginia tax law, with citations.

Currency note: this ruling is from 2009
Subsequent statutory amendments, regulation changes, court decisions, or later rulings may have changed the analysis. Treat this page as historical context, not current tax advice. Verify current law before relying on any specific rule, rate, or position mentioned here.
Disclaimer: This is Virginia Tax Bulletin 09-10, initial guidance issued one day after enactment of the 2009 Military Spouses Residency Relief Act. It expressly anticipated later detailed guidance and is not a taxpayer-specific ruling or current instruction. Federal protections, Virginia interpretations, forms, refund procedures, and local property rules may have changed. This summary is informational only and is not legal or tax advice.
About this page: The plain-English summary, reader guidance, and Q&A below were written by Ezel based on the official state tax ruling. The original ruling (linked on this page as a PDF) is the authoritative source for any reliance.
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Subject

Initial 2009 Virginia military-spouse tax guidance

Plain-English summary

Virginia Tax Bulletin 09-10 announced initial income, withholding, and personal-property relief for qualifying military spouses beginning with 2009. It was issued one day after the federal act was signed and promised later detailed guidance.

The act protected a spouse from gaining or losing domicile when present in a state solely to accompany a service member under military orders, provided the spouse and service member shared the same domicile.

A qualifying spouse could be exempt from Virginia tax on income from services performed in the Commonwealth. Refunds for 2009 could be claimed beginning January 1, 2010, and a revised Form VA-4 allowed a qualifying spouse to claim withholding exemption while considering tax obligations in the domicile state.

The bulletin also said a spouse's motor vehicles and other tangible personal property would receive the same treatment as property owned by the service member.

What this means for you

  • This was preliminary guidance, later supplemented by Tax Bulletin 10-1.
  • Relief depended on accompanying the service member under orders and maintaining a non-Virginia domicile.
  • The income protection focused on services performed in Virginia.
  • Withholding and personal-property treatment were addressed separately.

Common questions

What tax year did the act first affect?

2009; the bulletin said it did not affect 2008 or earlier taxes.

When could a 2009 refund be claimed?

On or after January 1, 2010.

Was more guidance expected?

Yes. The bulletin expressly said a later publication would provide details.

Citations and references

  • Military Spouses Residency Relief Act, S. 475, signed November 11, 2009.
  • Servicemembers Civil Relief Act, as amended.
  • Virginia Tax Bulletin 10-1, the later supplement.

Source

Original ruling text

TAX BULLETIN 09 – 10

Virginia Department of Taxation

November 12, 2009

Important Tax Information Regarding Spouses of

United States Military Servicemembers

On November 11, 2009, President Obama signed into law the Military Spouses Residency Relief Act (hereinafter, the “Act”) (S. 475). The Act is effective for taxable year 2009 and thereafter. It does not affect taxes imposed or paid for 2008 and earlier.

The Act amends the Servicemember Civil Relief Act (hereinafter, “SCRA”) to provide that a spouse shall neither lose nor acquire domicile or residence in a state when the spouse is present in the state solely to be with the servicemember in compliance with the servicemember’s military orders if the residence or domicile is the same for both the servicemember and spouse.

Currently, Virginia and a number of other states are collaborating to establish common guidelines for implementing the Act. Therefore, a subsequent Tax Bulletin will be published before the end of the 2009 that will provide military spouses more details about exercising their exemption from Virginia income tax.

Income Tax

Under the Act, a spouse of a servicemember may be exempt from Virginia income tax on income from services performed in Virginia if (i) the servicemember is present in Virginia in compliance with military orders; (ii) the spouse is in Virginia solely to be with the servicemember; and (iii) the spouse maintains domicile in another state. Any refunds for taxable year 2009 may be claimed on and after January 1, 2010.

Withholding Tax

A spouse whose wages are exempt from Virginia income tax under the SCRA may claim an exemption from Virginia withholding tax. Form VA-4 Personal Exemption Worksheet has been revised to reflect this exemption and can be found on TAX’s website at http://www.tax.virginia.gov . Spouses wishing to claim this exemption from income tax may file a revised Form VA-4 with their employer. Spouses claiming exemption from Virginia income tax should consider the impact on their income tax (and estimated income tax) liability in their domicile state.

Personal Property Tax

Motor vehicles and other tangible personal property owned by a spouse of a servicemember will be subject to the same tax treatment currently accorded servicemembers whether the property is owned or titled in the name of the servicemember, spouse, or both names jointly.

If you have any questions please contact TAX at (804) 367-8031.

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