Vermont Tax Brackets 2025 Guide – If you live in Vermont or earn income there, understanding the Vermont tax brackets 2025 is essential for accurate tax planning and filing. Vermont uses a progressive income tax system with five brackets ranging from 3.35% to 8.75%. These rates apply to your Vermont taxable income for the 2025 tax year (returns filed in 2026).
This guide breaks down the official 2025 brackets by filing status, explains how Vermont calculates your tax, highlights key changes, and provides filing tips. All information comes directly from the Vermont Department of Taxes.
Vermont Income Tax Brackets 2025 Overview
Vermont’s state income tax starts with your federal taxable income (from Form 1040) and applies Vermont-specific additions and subtractions. The state does not offer its own standard deduction or personal exemptions—it conforms to federal rules for most items.
For tax year 2025, the top marginal rate remains 8.75%, one of the highest in the U.S. Brackets are adjusted annually for inflation. If your federal adjusted gross income (AGI) exceeds $150,000, you may owe the greater of the regular tax or 3% of AGI (minus certain U.S. interest income).
Important: Use the official Tax Tables for taxable income under $75,000. For higher amounts, use the Rate Schedules below.
2025 Vermont Tax Brackets by Filing Status
Here are the official marginal tax rates and brackets for Tax Year 2025. These apply to Vermont taxable income (Form IN-111, Line 7).
Single Filers (Schedule X)
- $0 – $49,400: 3.35% of the amount over $0
- $49,401 – $75,000: $1,655 + 6.60% of the amount over $49,400
- $75,001 – $119,700: $3,345 + 6.60% of the amount over $75,000
- $119,701 – $249,700: $6,295 + 7.60% of the amount over $119,700
- $249,701 and above: $16,175 + 8.75% of the amount over $249,700
Married Filing Jointly or Qualifying Widow(er) (Schedule Y-1)
- $0 – $75,000: 3.35% of the amount over $0
- $75,001 – $82,500: $2,513 + 3.35% of the amount over $75,000
- $82,501 – $199,450: $2,764 + 6.60% of the amount over $82,500
- $199,451 – $304,000: $10,482 + 7.60% of the amount over $199,450
- $304,001 and above: $18,428 + 8.75% of the amount over $304,000
Married Filing Separately (Schedule Y-2)
- $0 – $41,250: 3.35% of the amount over $0
- $41,251 – $75,000: $1,382 + 6.60% of the amount over $41,250
- $75,001 – $99,725: $3,609 + 6.60% of the amount over $75,000
- $99,726 – $152,000: $5,241 + 7.60% of the amount over $99,725
- $152,001 and above: $9,214 + 8.75% of the amount over $152,000
Head of Household (Schedule Z)
- $0 – $66,200: 3.35% of the amount over $0
- $66,201 – $75,000: $2,218 + 6.60% of the amount over $66,200
- $75,001 – $171,000: $2,799 + 6.60% of the amount over $75,000
- $171,001 – $276,850: $9,135 + 7.60% of the amount over $171,000
- $276,851 and above: $17,179 + 8.75% of the amount over $276,850
How to Calculate Your 2025 Vermont State Income Tax?
- Start with federal taxable income.
- Make Vermont additions/subtractions (e.g., add back certain deductions or subtract income exempt in Vermont).
- Apply the appropriate Rate Schedule above.
- Subtract any Vermont tax credits.
- Add any additional tax if AGI > $150,000.
Example (Married Filing Jointly, $100,000 taxable income):
Base tax on first $82,500 = $2,764
Excess over $82,500 = $17,500 × 6.60% = $1,155
Total Vermont tax = $2,764 + $1,155 = $3,919 (before credits).
Use the official 2025 Vermont Tax Tables for incomes under $75,000 for exact amounts.
Key Changes to Vermont Tax Brackets in 2025
Brackets were inflation-adjusted upward from 2024, giving most taxpayers a slightly larger portion of income taxed at lower rates. The top rate of 8.75% remains unchanged. No major structural changes occurred, but updated forms (IN-111, HS-122, etc.) and enhanced identity verification are in place to prevent fraud.
Vermont Tax Credits and Deductions for 2025
Vermont offers several valuable credits that can significantly reduce your tax bill or generate a refund:
- Property Tax Credit (via HS-122) – Helps homeowners and renters.
- Renter Credit (via RCC-146).
- Earned Income Tax Credit (VT EITC).
- Credit for income tax paid to another state or Canadian province (Form IN-117).
- Voluntary charitable contributions can also be made on your return.
Vermont does not have its own standard deduction but follows federal rules.
Filing Your 2025 Vermont Taxes: Deadlines and Requirements
The 2025 tax filing season opened on January 26, 2026. The deadline to file your 2025 Vermont personal income tax return (Form IN-111) and pay any tax owed is April 15, 2026.
- File electronically through myVTax for faster refunds.
- Extensions are available with Form IN-151 (due by the original deadline).
- Full-year residents, part-year residents, and non-residents with Vermont-source income must file if they meet the filing threshold (generally aligned with federal requirements).
Additional Vermont Taxes to Consider in 2025
While income tax brackets get the most attention, Vermont also has:
- Sales tax: 6% statewide (no local add-ons in most areas).
- Property taxes: Among the highest in the nation, partially offset by the Property Tax Credit.
Frequently Asked Questions About Vermont Tax Brackets 2025
Do I owe Vermont tax if I live in another state but work in Vermont?
Yes, non-residents pay tax on Vermont-source income.
How do I get my 2025 Vermont tax forms?
Download from tax.vermont.gov or use the 2025 Income Tax Return Booklet.
What if my income is very low?
You may owe little or no tax, especially after credits. The first bracket starts at 3.35%.
Can I file jointly with my civil union partner?
Yes—Vermont recognizes civil unions for tax purposes.
Final Tips for Vermont Taxpayers in 2025
Review your withholding early using the 2025 Wage Bracket Withholding Charts. Consider consulting a tax professional or using myVTax for accurate calculations. Always double-check your return against the official Vermont Department of Taxes Rate Schedules and Tax Tables.
For the most current forms and calculators, visit the official Vermont Department of Taxes website at tax.vermont.gov.
Filing accurately using the 2025 Vermont tax brackets can save you money and avoid penalties. Stay informed and file on time by April 15, 2026!