Vermont rules
How Vermont taxes your salary after federal deductions in 2026
Vermont income tax: 3.35% to 8.75%
The Vermont Department of Taxes runs four progressive brackets. The entry rate of 3.35% is one of the lowest starting rates among high-tax states, and the wide first bracket covers taxable income up to $49,400 (single). The top 8.75% rate applies to income above $249,700.
| Rate | Taxable income |
|---|---|
| 3.35% | $0 – $49,400 |
| 6.60% | $49,400 – $119,700 |
| 7.60% | $119,700 – $249,700 |
| 8.75% | Over $249,700 |
2026 brackets after Vermont standard deduction ($7,650 single / $15,300 married). Source: VT Dept of Taxes, Tax Foundation 2026.
Vermont and property taxes
Vermont has some of the highest property tax rates in the United States, averaging about 1.9% of home value. Combined with the income tax, this means the total tax burden for a homeowner in Vermont can be significant. However, Vermont offers an income-sensitive property tax credit that reduces the effective property tax rate for lower-income homeowners.
Social Security and capital gains
Vermont taxes Social Security benefits (with a partial exemption for lower incomes) and treats capital gains as ordinary income. For salary earners these provisions have no effect on your paycheck, but they matter if you are comparing Vermont to retirement-friendly states.
Vermont salary after taxes: worked examples
Below is a side-by-side breakdown for three salary levels in Vermont, assuming single filing status with no pre-tax deferrals.
| Gross salary | Federal tax | FICA | VT state | Take-home | Keep % |
|---|---|---|---|---|---|
| $60,000 | -$5,020 | -$4,590 | -$1,850 | $48,540 | 80.9% |
| $100,000 | -$13,170 | -$7,650 | -$4,490 | $74,690 | 74.7% |
| $150,000 | -$24,734 | -$11,475 | -$8,016 | $105,775 | 70.5% |
Federal tax uses 2026 standard deduction ($16,100 single). FICA = 6.2% SS (up to $184,500) + 1.45% Medicare. VT state tax per bracket table above. Figures rounded to nearest dollar.
Vermont's wide first bracket keeps state tax manageable at lower salaries: at $60,000, the state tax is only $1,850 (3.1% of gross) because most taxable income sits in the 3.35% bracket. At $150,000, the state tax climbs to $8,016 as income enters the 7.60% bracket. The jump from $100K to $150K adds about $3,500 in state tax.
How to maximize your take-home in Vermont
Vermont's wide first bracket (3.35% up to $49,400) means that if your taxable income stays below that threshold, you pay only the lowest state rate. A combination of the $7,650 standard deduction and a $23,500 401(k) deferral effectively shelters $31,150, so a $75,000 salary would have only about $43,850 in state-taxable income, keeping almost all of it in the 3.35% bracket.
Vermont offers an Earned Income Tax Credit (EITC) equal to 38% of the federal EITC. If you qualify for the federal credit, the Vermont bonus is substantial. Additionally, Vermont's Child and Dependent Care Credit and property tax adjustment can further reduce your effective state burden.
Consider the full cost picture. Vermont has above-average property taxes but no sales tax on most groceries and clothing, and heating fuel is exempt from sales tax. For families, the state's universal pre-K program and generous childcare subsidies can offset part of the income tax cost. Vermont also provides a renter rebate program that returns a portion of rent considered equivalent to property tax, which can benefit renters earning under approximately $47,000.
How Vermont compares to other high-tax states
Vermont is gentle at the bottom and steep at the top. At $60,000, its $1,850 state tax is the second-lowest in this ten-state group (behind Rhode Island at $1,830). At $150,000, its $8,016 is mid-pack. The 8.75% top rate only matters for income above $249,700, which means most salary earners never touch it. Vermont's real tax challenge is property taxes: the state consistently ranks in the top five nationally for effective property tax rates, adding thousands to a homeowner's annual cost beyond what appears on the paycheck. Combined, Vermont's income and property taxes place it among the higher-burden states for homeowners earning above the median.
Filing status matters in Vermont
The calculator above supports Single, Married Filing Jointly and Head of Household. Married filers in Vermont generally benefit from wider bracket thresholds, so a couple with $150,000 in combined income pays less state tax than two single filers each earning $75,000. Head of Household filers, typically single parents, also receive wider thresholds. Always check the correct filing status for your situation because it affects both your federal and Vermont state tax simultaneously.
Also see: Vermont salary calculator for an interactive comparison with other states.
Questions
Vermont salary after taxes FAQ
What is the Vermont income tax rate for 2026?
Vermont has four progressive brackets: 3.35%, 6.60%, 7.60% and 8.75%. The top rate applies to taxable income above $249,700 for single filers. A state standard deduction of $7,650 (single) is applied before brackets.
How much salary do you keep after taxes in Vermont?
On a $100,000 single-filer salary, you keep approximately $73,200 after federal income tax, FICA and Vermont state income tax in 2026.
Does Vermont have local income taxes?
No. Vermont does not impose local or municipal income taxes. All income tax is collected at the state level.
How does Vermont compare to New Hampshire?
New Hampshire has no tax on wages or salaries. A $100,000 salary takes home roughly $5,000 to $6,000 more in New Hampshire. However, New Hampshire has higher property tax rates and no income tax deduction for property taxes.
Does Vermont tax Social Security benefits?
Yes, partially. Vermont taxes Social Security benefits but provides a partial exemption for individuals with adjusted gross income below certain thresholds. This does not affect active salary earners.
Can I reduce my Vermont tax with a 401(k)?
Yes. Vermont follows federal treatment of pre-tax 401(k) contributions. A $23,500 deferral reduces both your federal and Vermont taxable income.
What is the effective tax rate on $60,000 in Vermont?
A single filer earning $60,000 pays roughly $14,000 in total taxes (federal + FICA + VT state), for an effective total rate of about 23.4%. The VT state portion alone is approximately $1,600, an effective state rate of about 2.7%.
Is Vermont expensive to live in?
Vermont has above-average housing costs, particularly in the Burlington area, and some of the highest property tax rates nationally. Combined with income tax, the total tax burden is meaningful but offset by quality-of-life factors.
- Sources: Vermont Department of Taxes (2026 brackets) · IRS Rev. Proc. 2025-32 · SSA 2026 wage base · Tax Foundation 2026 state rates.
- 🔄 Last updated 2026-07-28 · Tax year 2026
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