Live in Virginia, Work Remotely for a Hawaii Employer: Who Taxes You?
Answer
One state, one return: Virginia. Hawaii has no wage income tax, so working there changes nothing about what you owe. Your Virginia resident return reports the Hawaii income along with everything else, and there is no credit to claim because Hawaii charged you nothing.
Last verified
Crossing into a state with no income tax does not lower your tax bill, because your home state is not taxing you on where you work — it is taxing you on where you live. Virginia reaches all of a resident's income, and Hawaii adds nothing on top.
What you file
- 1Resident return · Virginia
File a Virginia resident return reporting all of your income.
The two states, side by side
| Virginia | Hawaii | |
|---|---|---|
| Taxes wages | Yes — graduated | Yes — graduated |
| Reciprocity partners | 5 (Form VA-4) | None |
| Convenience rule | No | No |
| Nonresident return | Form 763 | Form N-15 |
| Credit for other-state tax | Schedule OSC | Schedule CR |
| Nonresident safe harbour | None published | None published |
| Local income tax | No | No |
| Revenue department | Virginia Department of Taxation | Hawaii Department of Taxation |
| Last verified |
The other direction
Reversing the commute does not always reverse the answer. Living in Hawaii and working in Virginia gives:Home state only.
Same two states, different situation
The withholding answer turns on how you are paid and where the work happens, not only on which two states are involved.
- W-2 commuter: Virginia → HawaiiBoth states — credit offsets the double tax
- 1099 contractor: Virginia → HawaiiHome state, plus the client state if you work there
- Moved mid-year: Virginia → HawaiiTwo part-year returns
Other Virginia pairs
Questions people actually ask
I live in Virginia and work remotely for a Hawaii employer. Which state do I pay?
One state, one return: Virginia. Hawaii has no wage income tax, so working there changes nothing about what you owe. Your Virginia resident return reports the Hawaii income along with everything else, and there is no credit to claim because Hawaii charged you nothing.
Which state should my employer be withholding for?
Virginia. Your employer should withhold Virginia tax rather than Hawaii tax on these wages. If a Hawaii line is showing on your pay stub, raise it with payroll now rather than at filing time.
Does my Hawaii employer's location alone create a Hawaii tax obligation?
No. Hawaii sources wages to the place where the work is physically performed, and it does not apply a convenience-of-the-employer rule that would override that. Days you actually spend working inside Hawaii are a different matter — those are Hawaii-source income and can require a nonresident return.
How current is this?
The Virginia and Hawaii rules on this page were last checked against Virginia Department of Taxation and Hawaii Department of Taxation on 2026-08-07. We re-check the full grid every December after state legislative sessions close, and re-check the convenience-of-the-employer states quarterly because that is where the rules move fastest.
Sources
Every fact above comes from the revenue department that publishes the rule. We do not cite secondary summaries, and we do not restate a figure we could not find at source.
- Virginia Department of Taxation — individual income taxaccessed 2026-08-07
- Virginia — Form VA-4accessed 2026-08-07
- Virginia Tax — Reciprocityaccessed 2026-08-07
- Hawaii Department of Taxation — individual income taxaccessed 2026-08-07