Updated for tax year 2025.
If you live or work in Vermont, you’ll likely need to file a Vermont state income tax return along with your federal return. Vermont uses a progressive income tax system with five marginal rates, so your filing status and taxable income affect how much state tax you owe.
This guide explains Vermont’s 2025 income tax rates and brackets, standard deduction and personal exemption amounts, available credits and adjustments, and updates for the current tax year. When you’re ready to file, TaxAct® automatically applies Vermont’s tax rules to help you accurately prepare your Vermont return alongside your federal return.
What is the Vermont state income tax?
Vermont state income tax is a tax on income earned by individuals. It is collected by the Vermont Department of Taxes and helps fund state services.
For tax year 2025, Vermont uses a progressive tax structure with marginal rates from 3.35% to 8.75%, depending on filing status and taxable income.
Vermont income tax rates and tax brackets
Vermont’s 2025 rate schedule is progressive. Here are the 2025 Vermont income tax brackets:
| Tax Rate | Single Filer | Head of Household | Married Filing Jointly, Civil Union Filing Jointly, or Surviving Spouse | Married Filing Separately |
|---|---|---|---|---|
| 3.35% | Up to $49,400 | Up to $66,200 | Up to $75,000 | Up to $41,250 |
| 3.35% | $75,001-$82,500 | |||
| 6.60% | $49,401-$75,000 | $66,201-$75,000 | $82,501-$199,450 | $41,251-$75,000 |
| 6.60% | $75,001-$119,700 | $75,001-$171,000 | $75,001-$99,725 | |
| 7.60% | $119,701-$249,700 | $171,001-$276,850 | $199,451-$304,000 | $99,726-$152,000 |
| 8.75% | Over $249,700 | Over $276,850 | Over $304,000 | Over $152,000 |
If you need more information on how federal tax brackets work, you can use our tax bracket calculator for federal taxes. See Form IN-111 tax rate schedules for official computation details.
Vermont standard deduction
Vermont has its own standard deduction amounts for 2025 (Form IN-111, Line 4). Higher amounts may apply if you or your spouse were born before Jan. 2, 1961, or are blind, based on the number of standard deduction boxes checked on federal Form 1040. Vermont also allows an additional $1,250 for each federal standard deduction box checked.
| Filing Status | 2025 Vermont Standard Deduction |
|---|---|
| Single | $7,650 |
| Married Filing Separately | $7,650 |
| Head of Household | $11,450 |
| Married Filing Jointly | $15,300 |
| Qualifying Surviving Spouse | $15,300 |
Vermont personal exemptions are $5,300 per exemption (Form IN-111, Line 5e). Your Vermont standard deduction and personal exemptions are combined on Form IN-111, Line 6.
Vermont exemptions, deductions, and credits
Vermont offers several credits and income adjustments on Schedule IN-112 and related schedules. Common examples include:
- Social Security exemption — income-eligible taxpayers may exclude all or part of federally taxable Social Security benefits (full exemption generally applies up to $65,000 AGI for most filers and up to $80,000 AGI for married filing jointly)
- Child and Dependent Care Credit — up to 72% of the federal credit for qualifying Vermont residents
- Vermont Earned Income Tax Credit (EITC) — 38% of the federal EITC for most qualifying Vermont residents; workers without qualifying children may claim 100% of the federal EITC for 2025
- Child Tax Credit, Veteran Tax Credit, and retirement-related exemptions on Schedule IN-112
For a full list of Vermont deductions and credits, see the Vermont Department of Taxes.
Vermont state income tax filing deadlines 2025
For tax year 2025, Vermont individual income tax returns are generally due April 15, 2026, the same deadline as federal returns. An automatic six-month filing extension may be available when qualifying federal extension requirements are met (extended due date October 15, 2026 for calendar-year filers).
Vermont tax changes for 2025
- Social Security exemption: Income eligibility limits for Vermont’s Social Security exemption increased to $65,000 AGI for single and other non-joint filers and $80,000 AGI for married filing jointly.
- Vermont Child Tax Credit: The maximum age for eligible children increased from 5 to 6. The credit is up to $1,000 per qualifying child.
- Vermont Earned Income Tax Credit: Vermont expanded the EITC for workers without qualifying children to 100% of the federal credit amount.
- Military retirement exemption: Military retirement and survivorship benefits may be fully exempt for incomes up to $125,000 and partially exempt up to $175,000.
- Vermont Veteran Tax Credit: A new $250 credit is available for income-eligible veterans.
FAQs
The bottom line
Vermont’s 2025 income tax is progressive, with marginal rates up to 8.75%. Understanding your bracket, deduction and exemption options, and available credits can help you better estimate your Vermont tax bill or refund.
When you’re ready to file, TaxAct can help you prepare your federal and Vermont returns in one place so you can file with confidence.
Already filed your taxes and waiting for your refund? Learn more about where your Vermont state tax refund is.
This article is for informational purposes only and not legal or financial advice.
All TaxAct offers, products and services are subject to applicable terms and conditions.
The OBBB is now also being referred to by lawmakers as the Working Families Tax Cut Act. You may see one or both names used here, but they refer to the same set of tax changes.
Citations
Vermont Department of Taxes. “2025 Form IN-111 Income Tax Instructional Booklet.” Accessed 21 Aug. 2026.
Vermont Department of Taxes. “Social Security Exemption.” Accessed 21 Aug. 2026.
Vermont Department of Taxes. “Personal Income Tax.” Accessed 21 Aug. 2026.