How much is Vermont income tax?
Vermont income tax at 3 levels of Vermont taxable income — what is left after Vermont's own deductions and exemptions. Local income taxes are not included.
| Taxable income | Single | Married filing jointly |
|---|---|---|
| $50,000 | $1,6953.4% effective · 6.6% marginal | $1,6753.4% effective · 3.35% marginal |
| $100,000 | $4,9955.0% effective · 6.6% marginal | $3,9193.9% effective · 6.6% marginal |
| $250,000 | $16,2016.5% effective · 8.75% marginal | $14,3245.7% effective · 7.6% marginal |
What are Vermont's income tax brackets for 2026?
| Taxable income | Rate |
|---|---|
| Up to $49,400 | 3.35% |
| Over $49,400 up to $119,700 | 6.6% |
| Over $119,700 up to $249,700 | 7.6% |
| Over $249,700 | 8.75% |
| Taxable income | Rate |
|---|---|
| Up to $82,500 | 3.35% |
| Over $82,500 up to $199,450 | 6.6% |
| Over $199,450 up to $304,000 | 7.6% |
| Over $304,000 | 8.75% |
Vermont has not published its 2026 rate schedule yet, so these are the 2025 rates and brackets — the newest Vermont has issued.
Source: Vermont Dept. of Taxes — 2025 Vermont Tax Rate Schedules (IN-111 booklet p.46), Schedules X · Y-1 · Y-2 · Z, checked September 12, 2026.
Can you deduct Vermont income tax on your federal return?
The federal deduction for state and local taxes (SALT) is capped at $40,400 for 2026 — $20,200 if married filing separately — and the cap shrinks toward $10,000 once modified AGI passes $505,000. A single filer with $250,000 of Vermont taxable income owes about $16,201 in Vermont income tax — 40% of that cap before any property tax.
SALT cap workaroundsDoes Vermont have a pass-through entity tax (PTET)?
No. Vermont has no elective pass-through entity tax, so an owner's Vermont income tax on business profit is paid personally and counts toward the federal SALT cap.
Are HSA contributions deductible in Vermont?
Yes. Vermont follows the federal treatment, so an HSA contribution — up to $4,400 with self-only coverage or $8,750 with family coverage for 2026 — lowers Vermont taxable income as well as federal.
Does Vermont give a tax break for 529 plan contributions?
Yes, as a credit rather than a deduction: Vermont gives a state income-tax credit for contributions to Vermont's own 529 plan. Income limits, per-beneficiary caps and carryforwards differ by state, so check the plan's rules.
529 plan tax savings calculatorWhat is the property tax rate in Vermont?
Vermont's average effective property tax rate is 1.59% — the 5th highest of 51 jurisdictions and 1.8 times the national average of 0.9%. That is about $1,590 a year for every $100,000 of home value; the rate varies widely by county and school district.
Itemize or take the standard deduction?How much does an LLC cost to keep in Vermont each year?
Deductsy budgets about $35 a year for a Vermont LLC — the annual report fee or minimum franchise tax, with a fee due every two years counted at half. Fees change, so confirm with Vermont's business filing office.
Vermont S-corp tax calculatorHow do Vermont taxes compare with neighboring states?
| State | Top income tax rate | Income tax on $100,000 (single) | Property tax (avg) |
|---|---|---|---|
| Vermont | 8.75% | $4,995 | 1.59% |
| Massachusetts | 9% | $5,000 | 1.07% |
| New Hampshire | None | $0 | 1.66% |
| New York | 10.9% | $5,336 | 1.55% |
On $100,000 of taxable income a single filer's Vermont income tax is $4,995 — more than in 1 of 3 neighboring states. The lowest is New Hampshire at $0; the highest is New York at $5,336. Vermont's average property tax rate is higher than in 2 of 3.
Income tax is each state's own tax on the same state taxable income; local income taxes are not included.
Tax moves that matter most for Vermont
That is the 5th highest of 51 and 1.8 times the national average, so property tax does much of the work of filling the SALT cap. Bunching two years of property tax into one can push itemized deductions past the standard deduction in alternate years.
An S-corp election can cut self-employment tax once profit is large enough to pay yourself a reasonable salary and still cover payroll and filing costs. The Vermont calculator adds Vermont's own entity fees and taxes to that breakeven.
With 1099 income, a Solo 401(k) can take up to $72,000 a year (2026) — usually more than a SEP-IRA at the same income. Contributions lower both federal and Vermont income tax.
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