IRS: Some Virginia 2022 Tax Rebates Aren't Taxable

If you owed money on your Virginia tax return in 2021, you were in luck in 2022. That's because the Virginia General Assembly passed a law giving some Virginia taxpayers a 2022 tax "stimulus" rebate of up to $250 for individual filers and up to $500 for joint filers. 

Most of those rebates were sent by Oct. 31, 2022, but you had to have filed your 2021 Virginia individual income tax return by Nov. 1, 2022 to receive the Virginia tax rebate.

Is your 2022 Virginia tax rebate taxable?

If you received a Virginia tax rebate payment, you may have been wondering whether the amount will be taxable on your federal income tax return. Last February, the IRS announced that most of the special state payments that were sent to residents during 2022 won't be taxable on 2022 federal returns.

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The IRS says if you received one of the Virginia 2022 tax rebates and claimed the standard deduction in 2021, or if you itemized deductions but didn’t receive a tax benefit, the special state tax rebate won’t be taxable on your 2022 federal income tax return. (An example of “not receiving a tax benefit” as a result of itemized deductions would be if the $10,000 limit on state and local tax (SALT) deductions applied on your return, according to the IRS.)

So, the good news is that if you took the standard deduction on your 2021 tax return, you shouldn't be taxed on the amount of your 2022 Virginia one-time tax rebate.

Virginia 2022 tax rebates

The one-time 2022 tax "stimulus" rebate check in Virginia is part of a recent trend. Other 2022 state stimulus checks were issued in more than twenty states, including California, New York, and Massachusetts, to name just a few. Several states are still sending "stimulus" checks and similar special rebate payments in 2023.

Other state "stimulus" checks

Many states were sitting on budget surpluses in part due to the influx of COVID-19 pandemic relief funds from the federal government.  

But it’s important to know that these state tax rebate checks and state stimulus payments are different from the three rounds of COVID-19 stimulus payments you may have received from the federal government. That federal stimulus program has ended.

When did Virginia send tax rebates?

Virginia sent 2022 rebate payments in the order it received your tax return. If you filed your Virginia tax return by Sept. 5 and were eligible for the 2022 Virginia stimulus tax rebate, your rebate should have been sent by Oct. 17. So, you should have received it by Oct. 31, 2022.

Some taxpayers received a check in the mail and others received the 2022 Virginia tax rebate through direct deposit to their bank account. If you’ve moved since last year, the check may have been forwarded to your new address and if Virginia doesn’t have your banking information on file, you might have received a paper check in the mail.

Note: you had to file your 2021 Virginia tax return by November 1, 2022, to receive the rebate.

Are more federal stimulus checks coming?

It’s important to know that the 2022 Virginia tax rebate and other 2022 state tax rebate checks and state stimulus payments are different from the three rounds of COVID-19 stimulus payments that you may have received from the federal government in the recent past.

That federal stimulus check program has ended. However, many states are still sending special payments in 2023 and Virginia's latest budget provides for new rebate payments.

Related Content

• IRS Says Most State "Stimulus" Payments Aren't Taxable
• States Sending Stimulus Checks in 2023
• Virginia Tax Guide