Accounting & Tax Tips
October 10, 2018

How to get the $50,000 Virginia Telework Tax Credit

Remember when they said teleworking was the future? They were right. In 2018, more than 37% of employees now telework in some form and teleworkers work 5 to 7 hours more a week than non-teleworkers and take less time off from work according to a study by the Society of Human Resource Managers.

Teleworking benefits both workers and employers. Work-life balance is cited as a top benefit, but it saves staff money as well. A study by Global Workplace Analytics found that the average teleworker saves up to $4,000 each year by eliminating expenses like gas, parking, public transit and daycare. By eliminating travel, the average worker also gains about 11 days per year. Employers save even more, up to $11,000/year per teleworker.

But the real benefit is for the cities and states that promote teleworking. The benefit has been shown to increase employment and drastically reduce a state’s carbon footprint (and traffic jams). Which is why Virginia brought back one of it’s most popular and lucrative tax credits ever this fall, the Virginia Telework Tax Credit.

What is the Virginia Telework Tax Credit?
The credit, which was discontinued in 2016 and brought back in the fall of this year, allows businesses to receive up to $50,000 in tax credits for telework-related purchases and investments through a one-time $20,000 credit to set up the program infrastructure and up to $1,200 per teleworking employee for expenses or capital purchases.

When does it expire?
The credit expires on October 31st, so you have to act quickly if you’d like to apply!

What Purchases can the Virginia Telework Credit be used for?

  • Laptop, tablet and computer equipment
  • Telework network equipment and software such as GoToMyPC
  • Telework Security and antivirus software and hardware
  • Routers, modems and internet access equipment and service
  • Voice Over IP equipment, cell phones, webcams, landline and other telework communication equipment and services
  • Coworking and telework center fees
  • Paying an IT professional as well as owner and staff salaries to work on setting up the telework program

What are the requirements?
The purpose of the Telework Tax Credit is to reduce driving to and from work to employees in Virginia, so your office must be located in the state. The employee must telework at least one day per week. The teleworker must sign a telework agreement after July 1, 2012 and before Jan 1, 2022 and must be a new teleworker. The employee must also be a new teleworker, existing teleworkers DO NOT qualify. Your company must also develop a formal telework policy and employee telework agreement.

What if I don’t have a Formal Telework Policy?
The credit doesn’t require you to have a telework policy in place at the time of the application, but you will need to formal telework policy and have your employees sign a telework agreement soon after. You can hire a technical consultant to help with this or you can create your own with information here:

To find specific details about applying, see the program and program requirements.

And you can also ask an associate at WendroffCPA. We received the credit and established our formal telework in 2009 when the credit was first introduced and would happily share our experience with you. To contact an associate at WendroffCPA, give us a call at 703-553-1099.

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