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Virginia Tax Commissioner Determines Taxpayer Required to Include Foreign Earned Income in State Income Tax Return

May 31, 2022, 5:00 AM

The Virginia Tax Commissioner March 22 determined in a letter ruling that Taxpayers weren’t entitled to an abatement of an individual income tax assessment, penalties, and interest. Taxpayers, a married couple, filed a state resident income tax return. The Department of Taxation issued an assessment because Taxpayers didn’t pay the tax due. Taxpayers appealed, requesting an abatement on grounds the income was taxed in the U.K. Taxpayers also sought a penalty and interest waiver due to the coronavirus pandemic and questions concerning the income’s taxability. The commissioner noted: 1) neither Virginia Code nor the U.S.-U.K. double taxation agreement (DTA) provides ...