VA HB1123

Creates a nonrefundable income tax credit of $5,000 for eligible health care providers who work at least 1,600 hours annually in medically underserved communities, or $2,500 for those working at least 800 hours

Eligible providers include nurse practitioners, physician assistants, doctors, registered nurses, advanced practice registered nurses, behavioral health providers, social workers, licensed counselors, and veterinarians

Credit applies to taxable years from January 1, 2026, through January 1, 2031, with each provider limited to claiming the credit for only two taxable years

Unused credits may be carried forward for up to five taxable years, and total credits are capped at $5 million per year, allocated on a first-come, first-served basis

Underserved communities are defined as areas identified by the Board of Health as medically underserved under existing state law