Taxes in Richmond
Virginia levies a real, graduated (not flat, not zero) state income tax -- 2% on the first $3,000, 3% on $3,001-$5,000, 5% on $5,001-$17,000, and 5.75% above $17,000 -- which is near-flat in practice for most earners since the top bracket starts at a genuinely low income threshold, alongside Richmond's real 6.0% combined sales tax rate and a proposed (but NOT enacted) new 7% top bracket this pass independently confirmed died in committee.
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Learn moreVirginia's Graduated Income Tax: Real Brackets, Near-Flat in Practice
Virginia's 2026 income tax brackets are 2% on the first $3,000 of taxable income, 3% on $3,001-$5,000, 5% on $5,001-$17,000, and 5.75% on everything above $17,000, applying identically across filing statuses. Because the top 5.75% bracket begins at such a low income threshold, this structure functions as a near-flat tax for the large majority of working taxpayers -- most of a typical earner's income is taxed at 5.75%, even though the rate is technically graduated rather than flat.
A Proposed 7% Top Bracket Did NOT Pass -- Confirmed Independently
House Bill 1754, which would have added a new 7% top bracket on Virginia taxable income above $600,000 beginning in 2026 (paired with a large standard-deduction increase), was independently checked this session and confirmed to have died in the House Appropriations Committee on February 4, 2025. It was never enacted. This detail is disclosed here specifically because some 2026-dated coverage of the bill can read as though it took effect -- Virginia's actual top marginal rate for 2026 remains 5.75%, not 7%.
Social Security Is Fully Exempt; A Real Age Deduction Applies to Other Retirement Income
Virginia does not tax Social Security benefits or Tier 1 Railroad Retirement income at all. Separately, Virginia's age deduction allows taxpayers 65 or older to deduct up to $12,000 of other income (pensions, IRA/401(k) distributions, investment income, and more) from state taxable income, phasing out $1 for every $1 that federal adjusted gross income exceeds $50,000 (single) or $75,000 (married filing jointly), fully eliminated at $62,000 single / $99,000 MFJ. Taxpayers born on or before January 1, 1939 receive the full $12,000 with no income test -- a real but now very small and shrinking cohort. See the retiring topic page in the companion file for the fuller retirement-specific picture.
Richmond's Combined Sales Tax Rate: 6.0%
Richmond's minimum combined 2026 sales tax rate is 6.0%, composed of Virginia's 4.3% state rate, a 1% local-option rate, and a 0.7% regional (Central Virginia transportation) tax. This is a moderate rate relative to many other states covered in this project, though the specific composition (a state rate plus two distinct local/regional add-ons) is worth understanding for anyone budgeting precisely.
Property Taxes Deserve Their Own Full Treatment
Richmond's real estate tax rate ($1.20 per $100 of assessed value, the highest among core Richmond-region jurisdictions) is covered in full on the property-taxes topic page rather than repeated here.
Key takeaways
- Virginia's 2026 income tax brackets are 2% / 3% / 5% / 5.75%, with the top bracket starting at just $17,000 -- functionally near-flat for most earners despite being technically graduated.
- A proposed new 7% top bracket on income above $600,000 (HB1754) was independently confirmed this session to have died in committee in February 2025 -- it is NOT current law; Virginia's actual 2026 top rate is 5.75%.
- Social Security and Tier 1 Railroad Retirement income are fully exempt from Virginia state tax; a separate age deduction (up to $12,000, phasing out above $50K single/$75K MFJ federal AGI) applies to other retirement income for those 65+.
- Richmond's combined sales tax rate is 6.0% (4.3% state + 1% local + 0.7% regional transportation tax) -- a moderate rate relative to many other states in this project.
- Richmond's real estate tax rate (the highest among core Richmond-region jurisdictions) is covered in full on the property-taxes topic page.
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