Filing your Vermont tax return for 2016 may seem challenging, especially if you haven’t done it before or are revisiting prior years. Whether you're an individual taxpayer, a sole proprietor, or a small business owner, this guide will help you understand the process and what forms, deadlines, and requirements you must know. If you missed the original filing deadline or owe tax for 2016, there's still time to take action and avoid further penalties or interest.

This step-by-step guide will explain who must file a Vermont income tax return, how to complete the correct forms, and what to include with your submission. It also outlines how to report your taxable income, calculate your individual income tax, and claim any deductions or credits you may be eligible for. You'll also learn how to request an extension, make a payment, and track your refund or tax statement online or by mail.

Whether you're filing for yourself or on behalf of someone else—such as older adults or part-year residents—this resource is designed to help you meet your obligations for the 2016 tax year. Understanding your federal income tax return is key, as much of the information used to file your Vermont return is based on data from your federal forms. With the right instructions and accurate documentation, filing your income tax return for a prior year doesn’t have to be difficult.

Who Needs to File a 2016 Vermont Tax Return?

You must file a 2016 Vermont tax return if you meet the federal income tax return requirement and your income or residency status triggers Vermont’s filing thresholds. The state uses your federal return as the starting point for calculating individual income tax, so filing both is essential for compliance.

To determine whether you're required to file a Vermont tax return for the 2016 tax year, review the following criteria:

1. You were required to file a federal income tax return for 2016

This is the foundation for Vermont filing. If the IRS requires you to file a federal return, you may also have to file with the state, depending on your income and residency.

2. You meet one of the following Vermont income conditions:

  • Full-year residents must file if they earned or received more than $100 of Vermont income during the calendar year.

  • Part-year residents must file if their total Vermont income exceeded $100 while living in the state.

  • Nonresidents must file if they received more than $1,000 in gross income from Vermont sources, such as wages, business income, or rental property.

These requirements apply to calendar year filers and fiscal year filers alike. Even if you previously believed your income was too low, you may still need to file if you are eligible for Vermont-specific tax credits, such as the earned income tax credit or property-related rebates. Filing also ensures accurate reporting of estimated tax payments or withheld amounts by your employer, which may entitle you to a refund even if you do not owe tax.

Important Deadlines and Penalties for 2016 Returns

For calendar year filers, the original filing deadline for the 2016 Vermont income tax return was April 18, 2017. This date aligned with the federal income tax deadline and applied to individual filers and small business owners. Understanding the due date is important because penalties and interest accrue immediately after this deadline unless you qualify for an extension or grace period.

Vermont offered a 60-day grace period for 2016 returns. You avoided the late filing penalty by filing by June 17, 2017. After the 60th day, the state imposed a flat $50 late filing penalty. In addition to the penalty, interest began accruing on any unpaid tax starting from the original due date, regardless of when you filed.

If you didn’t file or pay by the deadlines, penalties for late payment may still apply. However, if you are filing now for prior years and you qualify for a refund, the state may waive penalties, though interest on late refunds is not guaranteed. Fiscal year filers must follow deadlines based on their fiscal year end, and the same penalty and interest structure applies.

Which 2016 Vermont Tax Forms Do You Need?

The primary form for filing a 2016 Vermont tax return is Form IN-111. All individual income tax filers must complete this form, including full-year, part-year, and nonresident taxpayers. Your Vermont taxable income and any applicable credits or deductions are reported here.

Key Forms and Schedules for Individuals:

  • Form IN-111 – Vermont Individual Income Tax Return

  • Schedule IN-112 – Reports adjustments and credits, including the earned income tax credit, property tax credit, and other Vermont-specific benefits

  • Schedule IN-113—Used for complex income adjustment calculations, such as capital gains or business income

  • Form IN-117 – Required if you are claiming a credit for taxes paid to another state or Canadian province

  • Form IN-155—Reports federal itemized deductions that must be added back for Vermont purposes

  • Form IN-153 – Calculates the exclusion of capital gains from Vermont taxable income

Property-Related Forms:

  • Form HS-122 – Homestead Declaration and Property Tax Adjustment

  • Form PR-141 – Renter Rebate Claim (available to eligible Vermont renters)
    Older adults or lower-income taxpayers eligible for property-related tax benefits commonly use these forms.

Forms for Small Businesses:

  • Form BI-471 – Business Income Tax Return for pass-through entities

  • Form K-1VT—Used by business entities to report income, deductions, and credits distributed to owners, partners, or shareholders

Be sure to use the correct version of each form for the 2016 tax year. Filing with current-year forms for prior years will result in processing delays or rejection. You can request older forms directly from the Vermont Department of Taxes or download them from the state’s website.

Step-by-Step Instructions for Filing Your 2016 Return

Filing your 2016 Vermont tax return begins with preparation. Vermont bases much of its return on your federal income tax return, so completing that first is essential.

Step 1: Gather Your Documents

Before starting, collect all necessary records:

  • All W-2 and 1099 forms from 2016

  • A copy of your federal income tax return

  • Vermont withholding statements (if separate from W-2s)

  • Records of estimated tax payments made to Vermont

  • Proof of deductions or credits, such as child care expenses or education costs

  • Previous year’s Vermont tax return (if applicable)

Step 2: Complete Your Federal Return First

Vermont’s Form IN-111 relies on figures from your federal return, such as adjusted gross income. You’ll transfer values related to income, deductions, and credits from your federal income tax return to the Vermont form.

Step 3: Fill Out Form IN-111

Provide accurate personal information, including name, address, and Social Security number. Choose the correct filing status and ensure it matches your federal return. Report your total income, calculate Vermont taxable income, and determine your individual income tax liability. You’ll also report any Vermont tax withheld by your employer.

Step 4: Complete Supporting Schedules

Suppose you’re eligible for Vermont tax credits, such as earned or out-of-state tax credits; complete Schedule IN-112. If you have complex income or deductions, include Schedule IN-113 or IN-155, as applicable.

Step 5: Calculate and Review

Use Vermont’s 2016 tax tables to determine the amount you owe or your expected refund. Subtract eligible credits and estimated tax payments to finalize your return. If you owe tax, include payment with your return or use Vermont’s online payment portal. Review all entries, double-check your math, and ensure that required signatures are included before you file.

Filing Methods: Paper vs. E-Filing for 2016 Returns

Although 2016 tax year returns can no longer be e-filed through commercial tax software, Vermont still recommends using the myVTax portal for specific follow-up actions like payment, refund tracking, and extension requests. For most 2016 Vermont tax return submissions, paper filing is required.

Paper Filing Instructions

If you are filing your 2016 return now, complete Form IN-111 and any applicable schedules. Mail your return to the appropriate address based on whether you owe tax or expect a refund.

  • If you owe tax:
    Vermont Department of Taxes
    PO Box 1779
    Montpelier, VT 05601-1779

  • If you are due a refund or no payment is due:
    Vermont Department of Taxes
    PO Box 1881
    Montpelier, VT 05601-1881

If you're submitting a payment, include your check or money order and attach all necessary forms and documents. Keep a copy of everything for your records.

Benefits of E-Filing (for reference)

While e-filing was available in 2016, it's now limited to current-year returns. If you filed electronically in 2016 and need a copy, you can request prior-year transcripts or tax statements through myVTax.

How to Make a Payment to the Vermont Department of Taxes

If you owe tax on your 2016 Vermont income tax return, there are several ways to pay. The most secure and convenient option is to pay online using Vermont’s myVTax system. If you're mailing your return, you may also include a check.

Online Payment Options:

  • ACH Direct Debit: There is no processing fee, and the payment is securely transferred directly from your bank account. You can schedule the payment for a future date.

  • Credit or Debit Card: Accepted through myVTax. A 3 percent processing fee applies.

Payment by Mail:

  • Make checks payable to Vermont Department of Taxes

  • Include your Social Security number and tax year (2016) on the memo line.

  • Attach the check to the bottom left corner of your Form IN-111

  • Mail it to PO Box 1779 in Montpelier if payment is included

Using Form IN-116:

If you're making a payment separately from filing your tax return (such as after an IRS notice or payment plan request), use Form IN-116—Income Tax Payment Voucher for prior years. This form ensures your payment is correctly applied.

Payments must be timely to avoid interest or penalties. If you're paying now for a 2016 liability, interest began accruing from the original due date of April 18, 2017.

Tracking Your Refund or Balance Due

If you filed a 2016 Vermont tax return and are expecting a refund, or want to check the status of a balance due, Vermont’s myVTax portal provides secure and convenient access.

To Check Your Refund Status:

Visit www.myvtaxmyVTax.vermont.gov. You will need:

  • Your Social Security number

  • Your filing status

  • The exact refund amount you’re expecting

Typically, the IRS processed refunds for electronically filed 2016 returns (if submitted before the cutoff) in 2–3 weeks. Paper returns take longer, usually 6–8 weeks, and may take longer now because they are for a prior year.

If You Owe a Balance:

Use the same portal to view any outstanding balance, submit payment, or request a payment arrangement. You may also receive a tax statement by mail if additional amounts are owed.

If you have recently mailed your return, please allow several weeks for it to be processed. Delays are familiar with older tax filings, especially those mailed close to statute deadlines. 

Amending Your 2016 Return

You can file an amended return if you discover an error after filing your 2016 Vermont tax return. This may be necessary if you omitted income, claimed incorrect deductions or credits, or need to reflect a change from your federal income tax return.

To amend your return, complete a new Form IN-111 for 2016 and write “Amended” at the top. Include any updated supporting schedules (such as IN-112 or IN-113) and explain the changes. If the amendment is due to a correction on your federal income tax return, include a copy of the amended federal return or IRS adjustment notice.

Amended returns for 2016 must be filed within three years of the original due date (April 18, 2017) or two years of the tax payment date, whichever iyou are eligible for a refund, please act promptly to ensure you do not misstly to ensure you do not miss the statute of limitations.

Common Filing Errors to Avoid

An accurate income tax return reduces the risk of delays, penalties, or unexpected tax notices. Below are common mistakes that taxpayers make when filing for prior years:

  • Not completing the federal income tax return first: Vermont's Form IN-111 relies on federal income figures. You must file your federal return before starting your Vermont return.

  • Failing to add back federal deductions: Certain deductions, such as state and local tax write-offs, may need to be added back when calculating Vermont taxable income.

  • Using the wrong mailing address: Vermont has different addresses for returns with and without payments. Sending your return to the incorrect address can delay processing.

  • Omitting required schedules or forms: If you claim credits or report complex income, forms like IN-112 and IN-113 must be included.

  • Missing signatures: Returns without signatures are considered incomplete and will not be processed.

  • Math errors: Mistakes in calculations, especially on paper forms, can lead to processing delays or incorrect tax assessments.

Double-checking your return for these errors before submitting it can save you time, reduce stress, and help ensure your filing is accepted.

Final Checklist Before You File

Before submitting your 2016 Vermont tax return, use this checklist to confirm that all required items are included and accurate:

Documents and Forms:

  • Completed Form IN-111 for 2016

  • All relevant schedules (IN-112, IN-113, IN-117, etc.)

  • Copies of W-2 and 1099 forms from your employer or income sources

  • Federal income tax return for 2016

  • Documentation related to credits, deductions, and estimated tax payments is required.

Review and Accuracy:

  • Verify that all income amounts are accurate and all math calculations are correct.

  • Ensure your filing status matches what is reported on your federal return.

  • Confirm that your Social Security numbers are entered correctly.

  • If filing jointly, make sure both spouses have signed the return.

  • Double-check your bank account details if requesting a direct deposit refund.

Payment and Mailing:

  • If you owe tax, include your payment with the return or confirm that it has been scheduled online.

  • Mail your return to the correct address based on whether you expect a refund or have a balance due.

  • If paying by check, make it payable to the Vermont Department of Taxes and attach it securely to the return.

  • Keep copies of your full return, supporting documents, and payment records for at least three years for audit or reference purposes.

Taking time to complete this checklist will help you file a correct and complete return, avoid penalties, and receive your refund faster—if one is due.

Frequently Asked Questions (FAQs)

What if I missed the deadline for filing my 2016 Vermont tax return?

If you missed the filing deadline on April 18, 2017, Vermont allowed a 60-day grace period. After that date, a $50 late filing penalty and interest on unpaid tax were applied. You may still file for prior years, mainly if you are owed a refund or need to claim a credit. Complete your federal income tax return before submitting your Vermont income tax return.

Can I still file my 2016 Vermont income tax return?

Yes, Vermont accepts late-filed individual income tax returns for prior years. Interest and penalties will apply from the original due date if you owe tax. To claim a refund, you must file within three years of the due date. Include all required forms and your completed federal income tax return to ensure proper processing of your state return.

What deductions or credits might I be eligible for?

You may qualify for several Vermont tax credits, including the earned income tax credit, property tax adjustment, or a credit for taxes paid to another state. Standard deductions include business expenses, retirement contributions, or rental costs. Some federal deductions must be added to your Vermont taxable income, so review Form IN-155 closely. Supporting documents may be required to verify eligibility for any credits claimed.

How do I request an extension for the 2016 tax year?

To request an extension for 2016, you should have filed Form IN-151 by the original due date of April 18, 2017. An extension allows you more time to file your Vermont tax return but does not extend the time to pay. Penalties and interest apply if you didn’t pay your estimated tax by the due date. Always submit estimated payments with your extension request to minimize additional charges.

What if I cannot pay the full amount I owe?

If you cannot pay your tax liability for 2016, you should still file your return to avoid late-filing penalties. Vermont allows taxpayers to request a payment plan for outstanding income tax balances. Interest will accrue from the original due date, and penalties may apply. Use Form IN-116 or pay online through myVTax. Promptly contacting the Department of Taxes can help you avoid enforcement actions.

Are older adults eligible for additional Vermont tax benefits?

Yes, older adults may be eligible for Vermont tax credits such as the property tax adjustment or renter rebate. These benefits are claimed using forms like HS-122 or PR-141. Eligibility is typically based on income, age, and housing status. Be sure to include any required documentation with your tax return. Even if you owe no tax, filing may help you receive these credits or a refund.

What is the difference between a calendar year filer and a fiscal year filer?

Calendar year filers report income based on the standard January 1 to December 31 period. Most individuals use this method for both their federal and Vermont tax returns. Fiscal year filers, such as some businesses, use a different 12-month period for reporting. Vermont requires you to indicate your fiscal year dates on your income tax return and to follow applicable deadlines based on that custom tax year.