Budget & Taxes (Income Tax)

introduced · Vermont · House Feb 4, 2025

H 135: An act relating to administrative and policy changes to Vermont tax laws and extending reimbursement to municipalities for tax abatement due to flooding

H.135 updates Vermont's tax laws to align with federal income tax rules as of December 31, 2024, requiring joint state tax filings for couples who file jointly at the federal level. It adjusts the state's child and earned income tax credits to match federal rules, removing identification number requirements for some claimants. The bill also increases pay for property tax hearing officers and extends state reimbursement to municipalities for education property taxes reduced due to flooding. These changes directly affect Vermont taxpayers, families claiming credits, and flood-impacted municipalities.

Topics ✓ Budget & TaxesSupports Budget & TaxesAligns tax laws with federal rules, adjusts credits for relief, reimburses municipalities for flood-related tax losses, promoting fiscal management and tax relief.90% confidence

Sub-Topics Income Tax Property Tax Tax Incentives

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in committee · Vermont · House Mar 25, 2025

H 483: An act relating to the expansion of existing income tax credits

H 483 expands Vermont's tax credit programs to provide greater financial support for low- and middle-income residents. It extends the Vermont Child Tax Credit to cover children six years old or younger (previously age five), increases the Earned Income Tax Credit for individuals without qualifying children to 100% of the federal credit amount, and raises income thresholds for exempting Social Security and retirement income from state taxes. These changes directly affect families with young children, low-income workers without children, and retirees with modest incomes. The bill modifies specific Vermont tax code sections to implement these eligibility expansions and benefit increases.

Topics ✓ Budget & TaxesSupports Budget & TaxesExpands tax credits for low/middle-income families, increasing relief and raising income thresholds - directly advancing tax policy for fiscal support.95% confidence

Sub-Topics Income Tax Tax Credits

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introduced · Vermont · House Jan 23, 2025

H 74: An act relating to exempting Social Security benefits from Vermont income tax

H 74 would phase in full exemption of Social Security benefits from Vermont income tax over eight years. Currently, Vermont partially exempts Social Security benefits for lower-income seniors, but this bill raises the income thresholds where full exemption applies - increasing the single filer threshold from $65,000 to $77,000 and married filer threshold from $80,000 to $92,000. The change applies to all Vermont residents receiving Social Security benefits, with full exemption becoming effective by the eighth year. The bill amends Vermont’s tax code (32 V.S.A. § 5830e) to adjust the income-based exclusion rules. It is currently referred to the Committee on Ways and Means.

Topics ✓ Budget & TaxesSupports Budget & TaxesExpands tax exemption for Social Security benefits, raising income thresholds to provide tax relief to more seniors, aligning with tax relief indicators for support.95% confidence

Sub-Topics Income Tax

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introduced · Vermont · House Feb 21, 2025

H 309: An act relating to creating a Housing and Conservation Trust Fund checkoff on the Vermont personal income tax return

H.309 allows Vermont income taxpayers to voluntarily contribute to the Vermont Housing and Conservation Trust Fund by selecting a checkoff option on their state income tax return. Taxpayers would designate funds that are deducted from their tax refunds or overpayments, not from new payments. The bill creates a simple, voluntary mechanism for public support of housing and conservation projects without requiring any additional tax burden. This change applies to tax returns filed for taxable years beginning January 1, 2025.

Topics ✓ Budget & TaxesSupports Budget & TaxesVoluntary tax checkoff funds housing/conservation without new taxes, advancing public service funding through existing tax mechanism95% confidence ✓ EnvironmentSupports EnvironmentBill creates voluntary tax checkoff funding for conservation projects, directly advancing environmental conservation through dedicated trust fund support.95% confidence ✓ HousingSupports HousingBill creates voluntary tax checkoff to fund Vermont Housing and Conservation Trust Fund for housing projects, directly advancing housing funding without new taxes.95% confidence

Sub-Topics Income Tax Conservation

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introduced · Vermont · House Jan 23, 2025

H 76: An act relating to an income tax exemption for National Guard active duty subsistence and quarters allowance

This bill exempts Vermont National Guard members' state active duty subsistence and quarters allowance from the state's personal income tax. It directly affects Vermont-resident National Guard members who receive this specific allowance during state active duty. The key provision adds this allowance to Vermont's list of exempt military income, removing it from taxable income calculations. The exemption applies retroactively to tax years beginning January 1, 2025, and takes effect January 1, 2026.

Topics ✓ Budget & TaxesSupports Budget & TaxesExempts National Guard subsistence allowance from income tax, providing tax relief for military members, aligning with support indicators for tax relief.95% confidence ✓ VeteransSupports VeteransExempts National Guard active duty income from state tax, expanding financial benefits for military members serving state duty.95% confidence

Sub-Topics Income Tax Tax Incentives National Guard & Reserve

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introduced · Vermont · House Feb 18, 2025

H 249: An act relating to an income tax deduction for home study programs

This bill creates a $1,000 income tax deduction for Vermont taxpayers who cover qualified home study program expenses for their dependent children. It directly affects parents or guardians who educate their dependents through home study programs (as defined under Vermont law), provided the child is not claimed as a dependent by another taxpayer. The deduction covers costs like educational materials, equipment, and software required for home study, but does not include full tuition. The provision applies retroactively to taxable years beginning January 1, 2025.

Topics ✓ Budget & TaxesSupports Budget & TaxesCreates $1,000 income tax deduction for home study expenses, providing direct tax relief to qualifying parents while reducing taxable income.95% confidence ✓ EducationSupports EducationProvides tax deduction for home study program expenses, expanding educational access options for families under Vermont's defined home study programs.85% confidence

Sub-Topics Income Tax Higher Education

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introduced · Vermont · Senate Feb 28, 2025

S 104: An act relating to income-based education funding

Vermont's S.104 would replace the current education property tax with an income-based education tax starting in 2027, eventually applying to all residents (homeowners and renters) by 2030. The bill eliminates the homestead property tax but keeps nonhomestead tax on non-residential property, while creating new renter credits against the income tax and adjusting property tax credits to provide broader relief for lower-income households. It also establishes a new top income tax rate to offset revenue losses from these credit changes. The bill is currently in the Finance Committee after its first reading on February 28, 2025.

Topics ✓ Budget & TaxesSupports Budget & TaxesReplaces property tax with income-based system, provides renter credits & adjusted property tax credits for lower-income households, establishes top income tax rate to fund education.90% confidence ✓ EducationSupports EducationReplaces property tax with income-based tax to stabilize education funding, provides lower-income relief, and creates new revenue stream for schools per bill's funding mechanism.90% confidence

Sub-Topics Income Tax Property Tax School Funding

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introduced · Vermont · Senate Jan 17, 2025

S 17: An act relating to exempting military retirement and survivor benefit income from Vermont income tax

This bill exempts U.S. military retirement income and survivor benefit income received by Vermont residents from state income tax. It directly affects Vermont veterans and their surviving spouses or dependents who receive these benefits. The bill amends Vermont's tax code to add these income types to the list of exclusions from taxable income under § 5811, specifically adding a new exclusion (vii) for military retirement and survivor benefits. The change takes effect retroactively for taxable years beginning January 1, 2026.

Topics ✓ Budget & TaxesSupports Budget & TaxesBill exempts military retirement/survivor benefits from state income tax, providing direct tax relief to veterans and survivors. Directly amends tax code to add exclusion, aligning with tax relief indicators.90% confidence ✓ VeteransSupports VeteransExempts military retirement/survivor benefits from VT income tax, directly increasing disposable income for veterans and families. Clear benefit enhancement per bill's purpose.95% confidence

Sub-Topics Income Tax Military Families

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signed · Vermont · Senate Jun 16, 2025

S 51: An act relating to Vermont income tax exclusions and tax credits

Vermont's S.51 creates a $1,000-per-child refundable tax credit for residents with children under age 6, regardless of whether they or their children have a federal tax ID number. It also expands the state's earned income tax credit to cover individuals who qualify federally but lack required tax IDs, and adjusts exclusions for Social Security and Civil Service retirement income based on income thresholds (e.g., full exclusion for single filers earning ≤$55,000 or married couples ≤$70,000). The bill directly affects low-to-moderate-income families, retirees, and individuals with limited access to federal tax IDs. Signed into law by Governor on June 25, 2025, it modifies Vermont's tax code to broaden eligibility for existing federal credit programs.

Topics ✓ Budget & TaxesSupports Budget & TaxesExpands refundable tax credits for low-income families and adjusts retirement exclusions to benefit lower earners, providing direct tax relief per bill's provisions.95% confidence ✓ ImmigrationSupports ImmigrationExpands state tax credits without requiring federal tax IDs, enabling access for immigrants lacking status and aligning with immigrant service provision.85% confidence

Sub-Topics Income Tax Tax Credits