Internal Revenue Code and state taxation; conformity of tax laws of the Commonwealth.

Conformity of the tax laws of the Commonwealth to the Internal Revenue Code and state taxation. Provides that Virginia will deconform from certain provisions of the Internal Revenue Code for state income tax purposes, including the suspension of the overall limitation on itemized deductions, the bonus depreciation allowance for certain assets, the limitation on the election to expense certain depreciable business assets, the deduction for domestic research or experimental expenditures, and the modification of the limitation on business interest. The bill also provides that Virginia will not conform to (i) any amendment of the Internal Revenue Code enacted on or after January 1, 2026, with a projected impact that would increase or decrease general fund revenues by any amount in the fiscal year in which the amendment was enacted or any of the succeeding four fiscal years and (ii) all amendments enacted on or after January 1, 2026, if the cumulative projected impact of such amendments would increase or decrease general fund revenues by any amount in the fiscal year in which the amendments were enacted or any of the succeeding four fiscal years, but Virginia will still conform to any federal tax changes that the General Assembly subsequently adopts and to any federal tax extenders.