Vermont Income Tax Calculator
Estimate your 2025 Vermont state and federal income tax. Includes Vermont tax brackets, a worked dollar example, and filing tips.
Vermont State Income Tax Overview
Vermont uses a graduated income tax with four brackets ranging from 3.35% to 8.75% for 2024. Single filers reach the top 8.75% rate on income above $213,150. Vermont generally conforms to federal adjusted gross income and provides a standard deduction equal to the federal amount. The state taxes Social Security income but offers an exemption for lower-income residents. Vermont also has a meals and rooms tax and a 6% general sales tax. Vermont offers income-tested property tax adjustments for qualifying homeowners and renters, which can provide meaningful relief for lower- and moderate-income residents.
Vermont Income Tax Brackets (2025)
These are the Vermont state income tax brackets for single filers. Only the income within each bracket is taxed at that rate — not your entire income.
| Taxable Income | Tax Rate |
|---|---|
| $0 – $45,400 | 3.35% |
| $45,400 – $110,050 | 6.6% |
| $110,050 – $213,150 | 7.6% |
| Over $213,150 | 8.75% |
Source: Vermont Department of Taxes. Brackets shown are for single filers. Married filing jointly thresholds may differ.
What a Vermont Resident Actually Pays: A Worked Example
Your effective tax rate is almost always lower than your top bracket. Here is how the math works for a single filer earning $65,000.
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Frequently Asked Questions — Vermont Income Tax
Does Vermont have a state income tax?
Yes. Vermont imposes a state income tax with a top marginal rate of 8.75%. This is separate from your federal income tax obligation.
What is the Vermont income tax rate for 2025?
Vermont uses a graduated income tax system with rates from 3.35% to 8.75%. Only the income within each bracket is taxed at that bracket's rate — not your entire income.
Do I have to file a Vermont state tax return?
Most full-year Vermont residents with income above the state filing threshold must file a state return. Check the Vermont Department of Taxes for current thresholds and requirements.
How accurate is this Vermont state tax estimate?
This is a planning estimate. The state result uses Vermont's published brackets but does not account for all state deductions, credits, exemptions, or local taxes. Verify with official Vermont tax forms or a qualified tax professional.
Does this calculator include federal income tax?
Yes. The results show your estimated Vermont state income tax and your federal income tax using 2025 federal brackets — your full combined picture in one place.
Where can I find official Vermont tax forms?
Official forms, instructions, and filing guidance are available at the Vermont Department of Taxes.
Understanding Your Vermont Tax Estimate
Your results show both your estimated federal income tax and your estimated Vermont state income tax as a combined picture. Here is how to read them and what to do next.
Federal vs. State Tax: Two Separate Bills
Federal income tax is owed to the IRS and is the same rate schedule for all U.S. residents regardless of where you live. Vermont state income tax is a separate obligation paid to the Vermont Department of Revenue. You file two separate returns — one federal (Form 1040) and one state — though they are often prepared together using tax software.
How the Estimate Is Calculated
This calculator applies the 2025 federal tax brackets to your taxable income (gross income minus the standard or itemized deduction), then applies Vermont's published state brackets to estimate your state liability. The result is a planning estimate — not a filed return. It does not account for all credits, deductions, or individual circumstances that could change your actual bill.
Marginal Rate vs. Effective Rate
Your marginal rate is the rate on your last dollar of income — it is the highest bracket you reach, not what you pay on all income. Your effective rate is your total tax divided by gross income, and is almost always meaningfully lower. For example, a single filer earning $75,000 may be in the 22% federal bracket but pay an effective federal rate of only 14-15%. The same principle applies to Vermont state brackets.
3 Ways to Reduce Your Vermont Tax Bill
- Maximize pre-tax retirement contributions. Traditional 401(k) and IRA contributions reduce your federal taxable income. Many states, including Vermont, also exclude these contributions from state taxable income, reducing both bills simultaneously.
- Claim all applicable deductions and credits. Many states offer credits for property taxes, dependent care, education, and energy-efficient home improvements that are separate from federal credits. Check the Vermont Department of Taxes for Vermont-specific credits.
- Consider the standard vs. itemized deduction. Some states allow itemized deductions even if you take the federal standard deduction — or have their own standard deduction amounts that differ from federal. Checking the state-specific rules can sometimes reveal additional savings.
What to Do After Getting Your Estimate
- If you expect to owe money, consider adjusting your W-4 withholding or making a state estimated tax payment to avoid a balance due at filing time.
- If you are self-employed, your SE tax is separate — use our self-employment tax calculator to estimate that additional obligation.
- To verify your numbers, use the official Vermont tax forms or consult a qualified tax professional familiar with Vermont tax law.
Disclaimer: Estimates for educational purposes only. State tax results are approximations based on published bracket data and do not account for all deductions, credits, exemptions, local taxes, or individual situations. Not tax, legal, or financial advice. Consult the Vermont Department of Taxes or a qualified tax professional for guidance specific to your situation.