New tax laws in effect in Virginia as of January 1, 2020

New tax laws in effect in Virginia as of January 1, 2020
FILE — Tax season nears as 2019 comes to a close. (Source: KEYC)

CHARLOTTESVILLE, Va. (WVIR) - While Virginians are ringing in the new year, new tax laws are going into effect in the commonwealth. As of January 1, 2020, a number of new laws will change the way people in Virginia shop and do their taxes.

One law is a sales tax decrease on certain goods deemed essential hygiene products. The laws bring the sales tax on those products down to the rate previously reserved for food and other necessities.

“The law basically reduces the sales tax that applies on those products,” Chris Brubaker, a tax partner at Hantzmon Wiebel LLC said. "Those are feminine hygiene products, diapers and other disposal types of products, from the normal sales tax rate of 5.3% to 2.5%”

When Virginians go to file their 2019 taxes, they may also notice a big difference to the standard deduction as a result of what Virginia saw in 2018 taxes."

“The federal government essentially doubled the standard deduction," Brubaker explained. "As a result of that a lot fewer people itemized on their tax returns in 2018 than had before. Virginia stayed the same.”

That led to some people in Virginia seeing taxes increase, even though federal taxes lowered. For 2019 taxes, Virginia has made an adjustment.

“This year, Virginia has essentially increased their standard deductions by about 50%, from $6,000 for married couples to $9,000," Brubaker said. "And $3,000 for a single person up to $4,500. And so again, that just kind of carries over the benefit, it makes things a little more simple for Virginia taxpayers.”

New federal tax law also did away with the limit on itemized deductions. Virginia is reinstituting that limit.

“Virginia is bringing that back in on the calculation for Virginia income taxes so there is a limitation, once your income reaches a certain level," Brubaker explained.

The state of Virginia also allowed tax deductions for people telecommuting to expire. Those deductions would have allowed people working from home to deduct things like computer expenses or internet service.

“With the nature of work really changing with fewer people going into an office every day," Brubaker said. "It’s a benefit that really can help people out and so I would think that there’s a pretty good chance that as Virginia goes forward they might decide to bring that back in.”

Tax law is constantly shifting, making it hard for people to keep up. Brubaker says that tax experts are always there to help.

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