Fix Virginia Spouse Tax Adjustment wrongly applied to Social Security recipients

[PavelMakarchuk]

Summary

Fixes #8743. Virginia's Spouse Tax Adjustment (STA) was wrongly granted to couples where one spouse's only income is Virginia-exempt (e.g. Social Security, railroad retirement, unemployment, military/disability income), because the per-person Virginia AGI used by the STA worksheet (va_agi_less_exemptions_person) did not subtract that spouse's exempt income.

Root cause

va_agi_person prorated all subtractions by each person's federal AGI share. With a high-earner spouse, exempt-income subtractions were shifted onto that spouse, leaving the exempt-income-only spouse's separate VAGI inflated by income Virginia actually exempts — pushing the couple over the STA eligibility threshold.

Primary source

Virginia's "Worksheet for Determining Separate Virginia Adjusted Gross Income" (Form 760 instructions) attributes each subtraction to the spouse who received the income (STEP 2, Lines 14–17), then sets each spouse's separate VAGI.

Fix

Introduce va_subtractions_person, which attributes every Virginia subtraction to the recipient spouse, and have va_agi_person subtract it directly (federal AGI per person, less that person's own subtractions, plus prorated additions).

Per-person attribution covers: age deduction, taxable Social Security, Tier 1 railroad, unemployment, US government interest, military basic pay, disability income, federal/state-employee salary, and the military benefit subtraction. The National Guard subtraction (capped on the household total) is allocated by each person's military service income; the 529 deduction (a household contribution, not a person's income — so it cannot cause this bug) is prorated by federal AGI share.

The per-person subtractions sum exactly to the tax-unit va_subtractions across every income type tested, so tax-unit va_agi (and all downstream tax-unit results) are unchanged. The existing tax-unit subtraction variables are untouched.

Verification (issue scenario: VA MFJ, both age 70, head wages $125,714, interest $511 split, SS $28,783 split)

	Before	After
spouse va_agi_less_exemptions_person	$8,730.73	0
va_spouse_tax_adjustment	$195.48	0
va_income_tax	$5,599.76	$5,795.24

Also verified STA → $0 for a spouse whose only income is unemployment, railroad, disability, military retirement, military basic pay, or US government interest; and that a genuine two-earner couple still receives the STA ($257.50). The per-person/tax-unit invariant (Σ va_subtractions_person == va_subtractions, Σ va_agi_person == va_agi) holds across all of these.

Tests

• va_subtractions_person cases (unemployment, disability, military basic pay attribution)
• va_agi_person cases (Social-Security-only and unemployment-only spouse → separate VAGI 0)
• Integration cases: Social-Security-only and unemployment-only spouse → STA 0 / not eligible; two-earner couple → STA retained
• Full VA baseline suite: 458 passed (incl. va_agi_share → VA EITC) — no regressions

🤖 Generated with Claude Code

[codecov]

Codecov Report

✅ All modified and coverable lines are covered by tests.
✅ Project coverage is 100.00%. Comparing base (90fbe7a) to head (8a0002e).
⚠️ Report is 42 commits behind head on main.

Additional details and impacted files

@@            Coverage Diff             @@
##              main     #8744    +/-   ##
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  Coverage   100.00%   100.00%            
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  Files           19         2    -17     
  Lines          308        55   -253     
  Branches         0         1     +1     
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- Hits           308        55   -253     

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