Following the publication of Tax Bulletin 18-1 on February 26, we developed a medical expense deduction worksheet as an insert for the 760 instruction booklets.
We also posted the worksheet on our website and distributed it to tax software developers as a computational guide to supplement the information provided in TB 18-1.
We recently discovered that the worksheet did not adequately address situations where a taxpayer must add back the full amount of the federal deduction. If a taxpayer’s medical expenses do not exceed 10% of federal adjusted gross income, the Virginia addition is equal to the full amount of the federal deduction. We have clarified this issue on the worksheet by specifying that, in such cases, the amount on Line 6 should be entered as 0. This will allow taxpayers to correctly compute the Virginia addition.
Updated copies of both the worksheet and the instructions are now available on our website.
We are also communicating these changes to tax software vendors.
Should you have any questions, please contact Customer Services at 804.367.8031.