Virginia legislation · 2027 Regular Session
Virginia SB139: A BILL to amend and reenact § 58.1-322.02 of the Code of Virginia, relating to individual income tax subtraction; long-term capital gains from sale of principal residence.
Status: In committee, January 28, 2026
Individual income tax subtraction; long-term capital gains from sale of principal residence. Provides an individual income tax subtraction in taxable years 2025 through 2029 for income that is (i) taxed as a long-term capital gain for federal income tax purposes, (ii) attributable to the sale of property that served as the taxpayer's principal residence for at least two of the five years preceding such sale, and (iii) in excess of federal limitations only allowing an exclusion from gross income for up to $250,000, or $500,000, for joint filers, of gain from such a sale.
What the bill says
To amend and reenact § 58.1-322.02 of the Code of Virginia, relating to individual income tax subtraction; long-term capital gains from sale of principal residence. ---------- Patron--McPike ---------- Referred to Committee on Finance and Appropriations ---------- 1. That § 58.1-322.02 of the Code of Virginia is amended and reenacted as subtractions. In computing Virginia taxable income pursuant to § 58.1-322, to the extent included in federal adjusted gross income, there shall be subtracted: 1. Income derived from obligations, or on the sale or exchange of obligations, of the United St.
From the introduced text, January 6, 2026:
A BILL to amend and reenact § 58.1-322.02 of the Code of Virginia, relating to individual income tax subtraction; long-term capital gains from sale of principal residence. ---------- Patron--McPike ---------- Referred to Committee on Finance and Appropriations ---------- 1. That § 58.1-322.02 of the Code of Virginia is amended and reenacted as subtractions. In computing Virginia taxable income pursuant to § 58.1-322, to the extent included in federal adjusted gross income, there shall be subtracted: 1. Income derived from obligations, or on the sale or exchange of obligations, of the United States and on obligations or securities of any authority, commission, or instrumentality of the United States to the extent exempt from state income taxes under the laws of the United States, including, but not limited to, stocks, bonds, treasury bills, and treasury notes but not including interest on refunds of federal taxes, interest on equipment purchase contracts, or interest on other normal business transactions. 2. Income derived from obligations, or on the sale or exchange of obligations, of the Commonwealth or of any political subdivision or instrumentality of the Commonwealth. 3. Benefits received under Title II of the Social Security Act and other benefits subject to federal income taxation solely pursuant to § 86 of the Internal Revenue Code. 4. Up to $20,000 of disability income, as defined in …