The wife told authorities that the month she moved out of the home Steven had been sleeping on the floor of Katie's bedroom.
The wife also said that she learned her daughter was pregnant and that Steven was the father in May 2017 after reading one of her other children's journals.
According to the warrants, Steven had asked the two younger children to refer to Katie as their step-mum, although she was their sibling.
After learning about the pregnancy, the wife said she contacted her estranged husband and asked if he had impregnated Katie. He allegedly admitted the baby was his and said they planned to get married.
Katie posted an Instagram photo in July stating that she and Steven had gotten "married", although they legally cannot do so.
Police said at some point after May 2017, Katie and Steven moved to Wake County, North Carolina together. Arrest warrants were issued for them in November 2017 and they were arrested at their Knightdale home in January.
Authorities said when they were arrested a baby boy was with them. Warrants revealed the baby was born in September 2017.
The father and daughter are being held in the Wake County Detention Center pending extradition to Virginia. They have been charged with incest with adult, adultery, contributing to delinquency.
Steven and Katie were each issued a $1million bond. Steven bonded out of jail, but Katie remains behind bars.
It's not clear who the baby is in the care of.