VA elderly 2025 joint 125Kpwages 28Kgssi

[feenberg]

See http://taxsim.nber.org/out2psl/992

PE and TA agree on tax before credits, and total credits, but PE shows tax after credits $195 lower.

[PavelMakarchuk]

The $195 is Virginia's Spouse Tax Adjustment (Form 760 Line 17). PolicyEngine splits jointly-reported income — interest, dividends, capital gains, pensions, and Social Security — 50/50 between spouses by convention, so the spouse receives VAGI and the couple qualifies for the STA. TAXSIM-35 assigns all of that income to the primary filer, so it computes no STA — which is why PE's tax comes out $195 lower.

This is a spousal income-allocation convention difference, not a calculation error: with all the income placed on one spouse, PE also returns a $0 STA and matches TAXSIM at $5,795.30 exactly. (I confirmed both directly — STA = $0 with all income on the filer, STA = $195.48 with the 50/50 split.)

[feenberg]

I don't think this taxpayer is eligible for the STA. The STA worksheet makes it clear why I think that. I added the Spouse Tax Adjustment Worksheet to http://taxsim.nber.org/out2psl/992

Notice Line 3 of Part 1. That says that since spouse portion of AGI is less than $1,730 no STA is allowed. Given the large gssi, that is a surprices but it turns out in line 15 of part 2 that the $28,783 of social security is split evenly between the taxpayer and spouse (both are 70) , which means it does not contribute to line 19 on page 2. That leaves only the spouse's share of 511 interest income, which isn't enough to trigger the adjustment.