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

Summary

The bill lets Virginia taxpayers subtract from their state taxable income any long‑term capital gain from the sale of their principal residence that is larger than the federal $250,000 (or $500,000 for joint filers) exclusion. It applies to sales where the home was the main residence for at least two of the five years before the sale and only for tax years 2025 through 2029. This reduces state tax liability for homeowners who realize large gains on their homes.

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