How to File Your Vermont Tax Return for 2024: Step-by-Step Guide for Individuals and Small Businesses

Filing your Vermont tax return for 2024 doesn’t have to be overwhelming. Whether you’re a first-time filer, a long-time resident, or a small business owner, this guide will walk you through the process step by step. It covers everything from forms and deadlines to deductions, credits, and refund tracking, using information from the Vermont Department of Taxes.

If you’re required to file a federal income tax return, chances are you’ll also need to file a Vermont income tax return. Understanding what forms apply to your situation, how to calculate your adjusted gross income, and when to file can help you avoid IRS penalties and stay compliant with state and federal requirements. This guide is designed to simplify the tax filing process so you can file with confidence.

Throughout this article, you’ll learn how to access the correct forms, determine your eligibility for tax credits like the earned income tax credit or property tax credit, and avoid common mistakes. We’ll also cover electronic filing options, how to pay your taxes, and how to get free help if you need it. By the end, you’ll have everything you need to complete your Vermont tax return efficiently and on time.

1. Vermont Income Tax Basics for 2024

Understanding Vermont’s income tax requirements is the first step to filing accurately and on time. Whether you live in the state year-round, move during the year, or earn Vermont-based income as a nonresident, it’s essential to know when you're required to file, which tax return applies to your situation, and what changes may affect your filing this year.

Who Must File a Vermont Tax Return

You must file a Vermont income tax return for the 2024 tax year if:

• You are required to file a federal income tax return, and
• You earned more than $100 in Vermont income, or
  
  
• You earned more than $1,000 in gross income as a nonresident of Vermont.

This applies whether you are a full-year resident, a part-year resident, or a nonresident with Vermont-source income.

Vermont Residency Categories

Your filing obligation depends on your residency status:

• Resident: You lived in Vermont for the whole year or maintained a permanent home in Vermont and spent more than 183 days there.
  
  
• Part-Year Resident: You moved into or out of Vermont at any point during the year.
  
  
• Nonresident: You lived outside Vermont but earned income from Vermont sources, such as wages, self-employment, or rental property.

Understanding your residency classification ensures you use the correct tax forms and calculate income and credits accurately.

Filing Deadline and Extension

Vermont tax returns' standard April filing deadline is April 15, 2025. If you need more time to file, you can request an extension by submitting Form IN-151. However, an extension only gives you more time to file, not more time to pay.

Payments are still due by the April filing deadline. If you pay late, you may face interest charges and IRS penalties, including:

• A late payment penalty of 1% per month, up to 25% of the unpaid tax
  
  
• A $50 late filing penalty if you file more than 60 days after the deadline
  
  
• Interest that begins accruing from the original due date

What’s New for the 2024 Tax Year

Beginning July 1, 2024, Vermont has introduced a Child Care Contribution. If you are self-employed and earn income from Vermont sources, you must calculate and report this contribution on Line 21 of Form IN-111. The contribution is 0.11% of self-employment income earned on or after July 1, 2024.

Staying informed about new tax laws helps taxpayers avoid miscalculations or rejected returns. If you're unsure about your filing obligation or changes affecting your situation, consider consulting tax experts or a trusted tax preparer. Getting expert help early in the tax season can help you file taxes accurately and on time while avoiding unnecessary stress.

2. Which Vermont Tax Forms You’ll Need

Filing the correct tax forms is essential to ensure your income tax return for Vermont is processed smoothly. The forms you need depend on your residency status, income sources, housing status, and whether you operate a small business or are self-employed.

Forms for Individual Taxpayers

• Form IN-111: Required for all individuals filing a Vermont income tax return.
  
  
• Form IN-112: Use if you have Vermont-specific income adjustments.
  
  
• Form IN-113: Nonresidents and part-year residents are required to allocate Vermont income.
  
  
• Form IN-117: Required if you claim credit for income tax paid to another state or Canadian province.
  
  
• Form IN-119: For claiming certain Vermont tax credits or adjustments not included on IN-112.

Housing and Property-Related Forms

• Form HS-122 (Vermont Homestead Declaration): Required annually if you own and occupy your Vermont home as your primary residence.
  
  
• Schedule HI-144 (Property Tax Credit Claim): Use this if you apply for a property tax credit in Vermont based on household income.
  
  
• Form RCC-146: Submit this if you qualify for a renter credit.

Forms for Small Businesses and the Self-Employed

• Form BI-471: Used by S-corporations, partnerships, and multi-member LLCs with Vermont income.
  
  
• Form BI-476: A simplified version of BI-471 for Vermont-only businesses with Vermont resident owners.
  
  
• Form WH-435: Used to make estimated income tax payments for nonresident shareholders or partners.
  
  
• Form CO-411: Required for C-corporations and LLCs taxed as corporations.

These forms are available through the Vermont Department of Taxes website as fillable PDFs or paper copies that can be requested by mail.

3. Step-by-Step Instructions to File Your Vermont Return 

Whether you're filing as an individual, a sole proprietor, or a business owner, following a straightforward step-by-step process helps reduce errors and avoid delays. Vermont’s income tax return process is closely tied to your federal return, so keep your completed federal income tax return nearby.

For Individual Taxpayers (Form IN-111)

1. Gather your documents
   You will need:
   
   
   
   • A copy of your completed federal return (Form 1040)
     
     
   • W-2s and 1099s showing wages and Vermont income
     
     
   • Records of unemployment income, other earnings, and deductions
     
     
   • Receipts for estimated payments made during the year
     
     
2. Complete your personal information.
   Fill out your name, Social Security Number or ITIN, mailing address, and Vermont school district code.
   
   
3. Select your residency and filing status.
   Please check the boxes that apply to your situation—single, married filing jointly, resident, part-year, or nonresident.
   
   
4. Report your income
   
   
   
   • Start with your federal adjusted gross income.
     
     
   • Add or subtract Vermont-specific adjustments using IN-112.
     
     
   • Total your Vermont income on the appropriate line of Form IN-111.
     
     
5. Claim deductions and exemptions
   Use the standard deduction for your filing status. Apply applicable credits and calculate exemptions based on household members.
   
   
6. Determine your Vermont tax.
   Calculate your tax liability using the tax table or rate schedule and adjust it if you’re filing as a part-year or nonresident.
   
   
7. Apply tax credits.
   
   
   
   • Credit for income tax paid to another state (IN-117)
     
     
   • Earned income tax credit
     
     
   • Other Vermont credits from IN-119
     
     
   • Charitable contributions, if eligible
     
     
8. Add the Child Care Contribution
   If self-employed, calculate 0.11% of your self-employment income earned after July 1, 2024.
   
   
9. Report Use Tax
   Use Line 22 to report unpaid sales tax on out-of-state or online purchases.
   
   
10. Calculate payments and refunds or the balance due.
    Enter Vermont tax withholdings and estimated payments. Determine if you owe money or are due a refund.
    
    
11. Sign and date
    If you are filing jointly, both you and your spouse must sign. Paid preparers must also complete their section.
    
    

For Sole Proprietors

• Include Schedule C income on your federal return.
  
  
• Transfer your federal adjusted gross income to Form IN-111.
  
  
• Complete all steps above, including the Child Care Contribution if applicable.
  
  
• Use IN-117 to claim any tax paid to another state on business income.
  
  

For Small Business Owners

1. File the appropriate business return (BI-471 or BI-476).
   
   
2. Pay the $250 minimum entity tax.
   
   
3. Report Vermont-source income and file Form WH-435 if you have nonresident owners.
   
   
4. File your personal income tax return to report your share of pass-through income.

These steps will help Vermont taxpayers file taxes accurately, minimize errors, and ensure eligibility for every tax credit or deduction available.

4. How to File Your Vermont Tax Return

There are several methods to file your Vermont income tax return. Electronic filing is the most secure and efficient option, though some filers may still prefer mailing paper forms.

Electronic Filing (E-Filing)

E-filing is the fastest and most accurate way to file taxes. You can submit your Vermont tax return using the following methods:

• Commercial tax software: Most major providers support Vermont e-filing. You may qualify for free filing through the Free File Alliance if you meet specific income requirements.
  
  
• A tax preparer: Tax experts can prepare and file your federal and Vermont returns on your behalf.
  
  
• The myVTax: You can file select forms like IN-151, HS-122, RCC-146, and BI-476 directly through myVTax.vermont.gov. Form IN can be filed using approved tax software or through a preparer.

E-filing reduces the risk of errors and helps ensure faster return and refund processing.

Paper Filing

If you choose to file by mail:

• Use only blue or black ink and avoid staples or tape.
  
  
• Include all necessary forms, schedules, and attachments.
  
  
• Double-check all personal information and calculations.
  
  
• Make a copy of everything you submit for your records.

Should you anticipate a refund or have a payment to make, please ensure your completed return is sent to the correct address for the Vermont Department of Taxes. Processing paper returns may take longer, especially during the busiest times of the year for taxes. 

5. How to Make a Payment to the Vermont Department of Taxes

If you owe income tax, paying it on time after you file your Vermont tax return is essential. Vermont offers many easy ways to pay their taxes, so taxpayers can do so without too much stress or delay.

Payment Options

You can pay your taxes using one of the following methods:

• ACH Debit (Electronic Payment): Submit payment directly from your bank account through the myVTax portal. This method is free and commonly used during tax season.
  
  
• Credit or Debit Card: Make payments online through myVTax.vermont.gov. A service fee of approximately 3% applies.
  
  
• Check or Money Order: Mail your payment along with Form IN-116. On the memo line of your check, write your Social Security number and “2024 IN-111.”

Timely payment ensures that your income tax return is not flagged or rejected due to incomplete filing.

Payment Deadline and Penalties

Even if you apply for an extension to file your return, you must still pay any tax owed by the April filing deadline of April 15, 2025. Missing this deadline can lead to IRS penalties and accrued interest.

Penalties include:

• A 1% monthly penalty on the unpaid tax, up to 25%
  
  
• A $50 late filing penalty if you submit your income tax return more than 60 days after the deadline
  
  
• Interest charges beginning from the original due date

Pay as much as possible with your initial tax filing to avoid unexpected costs, even if you're awaiting tax preparer assistance or plan to request an extension.

Payment Plans

If you are unable to pay your full balance by the due date, Vermont allows taxpayers to request a payment plan:

• File your federal return and Vermont forms on time
  
  
• Wait for the first notice of assessment from the Vermont Department of Taxes.
  
  
• Log in to myVTax.vermont.gov to apply for a payment plan.
  
  
• Alternatively, write to the Department at PO Box 429, Montpelier, VT 05601-0429 (ATTN: Compliance)

Making payment arrangements protects you from further penalties and helps keep your file in good standing.

6. How to Track Your Refund or Balance Due

After you file taxes, you may be entitled to a refund depending on your Vermont income, credits, and income tax paid during the year. Fortunately, the Vermont Department of Taxes offers several ways to check your status.

Tracking Your Refund

• Online: Visit myVTax.vermont.gov and select “Check the Status of Your Return.” Enter your Social Security Number and the exact refund amount on your Vermont tax return.
  
  
• By Phone: Call (802) 828-2865 or (866) 828-2865 toll-free in Vermont. Business hours are Monday, Tuesday, Thursday, and Friday from 7:45 AM to 4:30 PM.

Most e-filing returns are processed within 6–8 weeks. Paper forms can take 8–12 weeks or longer, especially during peak filing times. Delays can occur if incomplete forms contain math errors or are selected for further review.

Balance Due or Refund Offsets

Your balance can be viewed on the myVTax portal if you owe taxes. The Department may apply your refund to offset outstanding debts, including:

• Past-due Vermont taxes: If you owe back taxes to the state, your refund may be applied toward that unpaid balance.
  
  
• Child support obligations: The department can redirect your refund to cover overdue child support if reported by enforcement agencies.
  
  
• Federal tax debts: Your refund may be reduced to pay federal tax liabilities collected by the IRS.
  
  
• Unpaid debts to other states, like California: Refunds may also be used to satisfy outstanding debts owed to other states participating in offset programs.

If your refund is reduced due to an offset, you will receive a written notice explaining how the funds were applied.

Receiving your refund faster may depend on choosing direct deposit, using the correct tax forms, and ensuring your adjusted gross income and deductions are calculated accurately.

7. Final Filing Checklist

Before filing your Vermont tax return, ensure you have all the proper paperwork and recheck your information. You lower the chance of mistakes and increase your chances of getting your refund quickly by sending a complete and accurate return.

Use This Checklist Before You File

• Verify your details, including your name, Social Security Number, address, and school district code.
  
  
• Check that your federal income tax return matches your Vermont figures.
  
  
• Verify your adjusted gross income and total income.
  
  
• Make sure you applied the proper deductions and tax credit amounts.
  
  
• Report use tax for online or out-of-state purchases.
  
  
• Calculate and report the Child Care Contribution if you’re self-employed.
  
  
• Include all W-2s, 1099s, and supporting forms.
  
  
• Attached are the required Vermont forms, such as IN-112, IN-113, IN-117, and IN-119.
  
  
• Sign and date your return—both filers must sign if filing jointly.
  
  
• Choose your payment method or direct deposit for your refund.

Homeowners and Business Owners

• File your Vermont homestead declaration (Form HS-122) by April 15 if you own and occupy your home.
  
  
• Submit your property tax credit claim (Schedule HI-144) if eligible.
  
  
• Pay the minimum business tax of $250 if you own an S-corp, partnership, or LLC.
  
  
• File business returns (BI-471 or BI-476) by March 15, 2025, if operating on a calendar year basis

By preparing ahead of time, you can reduce effort, avoid rejections, and maximize your refund. Use these tax tips to simplify the process and comply with state requirements.

Frequently Asked Questions

What should I do if I missed the April filing deadline for my Vermont tax return?

Suppose you missed the April filing deadline for your Vermont tax return. File as soon as possible to reduce IRS penalties and interest. While an extension gives you more time to file, it doesn’t delay the deadline to pay taxes owed. Filing late without payment may lead to penalties based on the unpaid income tax. Even if you can't pay in full, submitting your income tax return prevents more serious enforcement actions.

Can I file my Vermont tax return for free?

Yes, many Vermont taxpayers qualify for free help filing their tax returns. Through the Free File Alliance, eligible filers can use approved e-filing software at no cost. This is based on income, age, or military status. The Vermont Department of Taxes website provides direct access to these services. Always review your adjusted gross income and credits before you file taxes to ensure you get the maximum refund available.

What tax credits should Vermont filers not overlook?

Common Vermont tax credits include the earned income tax credit, property tax credit claim, credit for income tax paid to another state, and charitable donations. These credits help reduce your income tax and may increase your refund. Carefully review all applicable tax forms when you prepare your return, especially if you’ve had changes in income, employer, deductions, or unemployment in the past year.

How do I amend a rejected or incorrect Vermont tax return?

To correct a rejected or inaccurate tax return, submit an amended Vermont income tax return using Form IN-111 and check the “Amended” box. You’ll also need to include corrected federal tax return documents. If you have filed for multiple years, please amend each year individually. Be sure to sign and date the revised return. Quick action can help avoid delays in your refund or further tax filing complications.

Do I need to file a Vermont Homestead Declaration every year?

Yes, homeowners in Vermont must file the Vermont Homestead Declaration (Form HS-122) annually. This form is due by the April filing deadline and ensures property tax credit claim eligibility. Even if you don’t owe income tax, you must still file to receive homeowner-based benefits. Filing late or skipping this form may result in penalties or reduced credits, so prepare it with your standard tax forms.

Who needs to file a Vermont tax return?

You must file a Vermont tax return if you are required to file a federal income tax return and earned Vermont-source income. This includes wages, self-employment income, or unemployment compensation. Both residents and nonresidents may need to file, depending on income levels. Vermont taxpayers should review their income, filing status, and deductions annually to determine their filing requirements before the tax season begins.

How can I get expert help to file my income tax return for Vermont?

If you need expert help to file taxes, you can work with a tax preparer or use tax experts available through e-filing platforms. Many companies offer expert review services to verify your forms and ensure accurate filing. Free help may also be available for eligible filers. This guidance can help you prepare your return with confidence, avoid IRS penalties, and ensure you claim all available credits.