Key figures
West Virginia accounting
2026, with sources
6.5%, combined, single sales factor
West Virginia taxes corporations at 6.5% of West Virginia taxable income through the corporation net income tax, administered by the State Tax Department. Corporations engaged in a unitary business with other corporations must file a combined report, a requirement in place since 2009, so a Delaware parent and its operating subsidiary are usually one combined filing.
For tax years beginning on or after January 1, 2022, business income is apportioned by the sales factor alone, and sales other than tangible goods are sourced to West Virginia when a service is delivered to a location in the state. Before 2022 West Virginia used a double-weighted sales factor and cost-of-performance sourcing, which matters only when amending older years.
Conformity
West Virginia updates its conformity to the Internal Revenue Code each year. The current statute gives effect to federal amendments made after December 31, 2024 and before January 1, 2026, to the same extent they apply federally, whether retroactive or prospective, and gives no effect to amendments made on or after January 1, 2026. That brings in the 2025 federal law, including expensing of domestic research costs, unless a specific West Virginia modification says otherwise.
For the provision, that means fewer West Virginia book-tax differences than in neighboring states that decoupled, and a current-year state tax that tracks the federal computation closely.
An example
A SaaS company with $3 million of revenue, $300,000 of it from customers in West Virginia, and $600,000 of combined taxable income apportions 10% to West Virginia, $60,000, and owes $3,900 at 6.5%. If its engineers were in West Virginia but its customers elsewhere, its West Virginia factor would be close to zero under the post-2022 rules.
The federal baseline
This page covers what West Virginia adds. The federal rules underneath it apply here too.
Common questions
How much of our income does West Virginia tax?
On its West Virginia share. Since 2022 West Virginia apportions with a single sales factor and sources services to where they are delivered, so West Virginia customers, not West Virginia staff, draw income into the state. The rate is 6.5%.
Does West Virginia follow the 2025 federal tax changes?
Generally, yes. West Virginia’s statute gives effect to amendments to federal tax law made after December 31, 2024 and before January 1, 2026 to the same extent they are allowed federally, whether retroactive or prospective, so the 2025 federal changes, including domestic research expensing, carry into the West Virginia starting point unless the Legislature adds a specific modification.
Accounting next door
- KYKentucky accountingKentucky taxes corporations at 5% plus a limited liability entity tax with a $175 minimum, requires unitary combined returns, apportions on single sales factor, and decouples from bonus depreciation and Section 174A.
- MDMaryland accountingMaryland taxes corporations at a flat 8.25% on separate-company returns, with a single receipts factor and services sourced to the customer. For 2025 it decoupled from federal R&D expensing.
- OHOhio accountingOhio has no corporate income tax; its 0.26% Commercial Activity Tax excludes the first $6 million of Ohio receipts, so the business tax a startup actually meets is its city’s net profit tax.
- PAPennsylvania accountingPennsylvania’s corporate net income tax is 7.49% for 2026 and falling, on separate-company returns with market-sourced services. Losses are capped as a share of income, and federal R&D expensing and bonus depreciation don’t carry through.
- VAVirginia accountingVirginia taxes corporations at a flat 6% with a double-weighted sales factor and cost-of-performance sourcing. It conforms to the IRC as of December 31, 2025 but decoupled from the 2025 R&D expensing and from bonus depreciation.
Founder guides on this
- US GAAPUS GAAP for early-stage startups, in plain EnglishAccrual accounting, revenue recognition (ASC 606), leases (ASC 842), stock compensation and capitalized software: what each means for a small company.
- R&D taxThe R&D tax credit and Section 174A for startupsEngineering salaries can earn a federal R&D credit against payroll tax, and Section 174A lets you deduct US research again. What qualifies, what to track.
- FundraisingAudit-ready books before your Series AInvestors, lenders and auditors ask for the same things: accrual statements, reconciled accounts and support for every balance. How to be ready first.
More of the West Virginia guide
- ReceivablesReceivables and sales tax in West VirginiaSales tax registration, economic nexus, whether SaaS is taxable, and collecting from customers
- PayablesPayables and contractors in West VirginiaPaying vendors and contractors: 1099 filing, use tax, contractor tests and withholding
- PayrollPayroll taxes and employer rules in West VirginiaWithholding, unemployment insurance, paid leave, minimum wage and the rules on paydays
- ComplianceCompliance and filings in West VirginiaRegistering to do business, annual reports, franchise tax and the filing calendar
- AdvisoryAdvisory: credits and decisions in West VirginiaCredits, incentives and the decisions that are cheaper to get right the first time
Sources
Checked against each agency’s own page on . Rates and thresholds change, usually on January 1.
General information for US companies, not tax, legal or accounting advice for yours. Rules and thresholds change; confirm the specifics with a CPA or the agency before you act on them.