Determination engine

Which state do you actually withhold in?

Reciprocity, convenience-of-the-employer, nonresident thresholds and unemployment localization, applied together to one employee's facts. Every answer cites the state source it came from.

Withhold Virginia income tax.

Arizona and Virginia have a reciprocal agreement, so the work state stands down once the exemption certificate is on file.

Income tax withheld to

Virginia

Graduated, top rate 5.75%

Employee certificate

WEC

Employee Withholding Exemption Certificate

Unemployment insurance

Arizona

Localized under factor 1: Localization.

Reciprocal agreement

Yes

Arizona exempts Virginia residents.

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File WEC with the employer

Reciprocity is not automatic. Until the employee files WEC (Employee Withholding Exemption Certificate) you are legally required to withhold Arizona tax. Keep the signed form on file; it is not sent to the state.

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Withhold Virginia income tax instead

Under the agreement the employee is taxed only by their state of residence. You will need a Virginia withholding account.

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Employer registrations you will need

Virginia — Income tax withholding: Virginia Department of Taxation
Arizona — Unemployment insurance: Arizona Department of Economic Security / Arizona Department of Revenue

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Get the form

WEC — Arizona (official state source)

Arizona profile Virginia profile Full write-up for this pair

Change the inputs

Withholding determination

Answer six questions. The result is a shareable link, so you can paste it into a ticket or an email.

Employee lives inState of residence

Work is performed inWhere the employee physically sits

Employer is based inWhere the work is directed from

Days in the work stateThis calendar year, leave blank if unknown

Wages from work-state daysUS dollars, leave blank if unknown

Arrangement Works remotely rather than at an employer location Remote work is an employer necessity, not employee preference

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This is a determination aid, not advice. StateSide encodes published state rules and applies them mechanically to the facts you enter. It does not know your entity structure, your nexus history, your equity compensation, or the dozens of exceptions that turn a clean rule into a judgement call. Every determination cites the state source it came from — verify against that source, and take anything consequential to a payroll tax professional before you act on it.