Virginia VK-1

In TurboTax Online, in the Virginia state income tax return, see Pass-Through Entity Elective Tax Payment Credit on the screen Take a look at Virginia credits and taxes.

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What is the Pass-Through Entity Elective Tax Payment Credit?

Pass-through entities ("PTE"), such as a Partnership or S Corporation, may make an annual election to pay Virginia income tax at the entity level.

A corresponding refundable income tax credit is available to the individual owners for the amount of income tax paid by the qualifying PTE that makes the election and pays the income tax imposed at the entity level.

The effect of the elective income tax and corresponding refundable credit is to allow the qualifying PTE to shift the income tax burden from the PTE owners to the PTE itself.

Any partnership, S corporation, or limited liability company distributing the credit to its partners, shareholders, or members must issue each owner a Schedule VK-1.