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HB 1210

Income tax, state; subtraction for long-term capital gains from sale of principal residence.

2026 Regular Session Introduced by Briana Sewell

Virginia bill would exempt long-term capital gains from principal residence sales from state income tax, reducing homeowner tax liability but decreasing state revenue.

Subcommittee recommends laying on the table (7-Y 3-N)
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Bill Summary · HB 1210

Legislative bill overview

HB 1210 would allow Virginia taxpayers to exclude long-term capital gains from the sale of their principal residence from state income tax calculations. This creates a state-level tax subtraction for homeowners who sell their primary dwelling after holding it for an extended period, complementing existing federal capital gains exclusions.

Why is this important

Home sales represent significant financial events for Virginia residents, and capital gains taxes can substantially reduce proceeds from selling a primary residence. This bill would provide tax relief specifically to homeowners, potentially affecting state revenue while benefiting those with appreciation in home values. The fiscal impact statement suggests measurable revenue implications that lawmakers are evaluating.

Potential points of contention

  • Revenue impact: The bill reduces state tax collections, which could affect funding for education, infrastructure, and services unless offset by other measures
  • Equity concerns: The benefit primarily accrues to homeowners (particularly those with appreciated properties) while renters and non-property owners receive no direct benefit, raising fairness questions
  • Existing federal exclusions: The federal government already allows $250,000-$500,000 in capital gains exclusions on primary residence sales, making the added state benefit potentially duplicative or narrowly targeted

Compiled from official sources — confirm details with the bill’s official record.

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