Filing your 2017 Vermont income tax return requires understanding state and federal filing responsibilities to ensure full compliance and avoid unnecessary penalties. Vermont residents, part-year residents, and certain nonresidents must report income from the tax year, using accurate figures drawn from their federal income tax return. This process involves careful review of income sources, deductions, and credits to meet Vermont’s filing requirements within the April filing deadline.

The Vermont Department of Taxes provides explicit instructions, forms, and schedules to guide taxpayers through each step. These official resources help individuals and small business owners prepare returns correctly, calculate taxable income, and determine whether they are owed a refund or must make a payment. Taxpayers who file promptly and accurately can quickly receive refunds and avoid delays caused by incomplete forms or missing documentation. Payment options and extension requests are available to prevent additional interest and penalties for those unable to pay in full by the due date.

By following this guide, filers will learn how to prepare their federal income tax return, transfer key details to Vermont forms, and complete the filing process on time. Each section of this article is designed to help individuals understand the requirements, avoid common mistakes, and confidently complete their 2017 Vermont tax return.

Overview of Vermont State and Federal Income Tax Requirements

Who Must File

Vermont requires a 2017 income tax return from full-year residents, part-year residents, and nonresidents who earned income from Vermont sources and meet specific thresholds. Full-year residents must file if they earned more than $100 in Vermont income, and nonresidents must file if they earned more than $1,000 from Vermont sources. These thresholds apply to the requirement to file a federal income tax return. The Vermont Department of Taxes outlines these rules clearly in its official filing guidelines, which are updated annually to reflect legislative changes.

Key Filing Deadlines

The April filing deadline for the 2017 tax year was April 17, 2018. Vermont aligns its due date with the federal income tax deadline, and both are extended if the date falls on a weekend or holiday. The state offers a 60-day grace period for taxpayers to file without penalty, although interest on unpaid balances still applies. Filing early allows taxpayers to quickly resolve any notices from the department, make timely payments, and receive refunds sooner.

Understanding the Connection to Federal Income Tax

Vermont uses federal adjusted gross income as the starting point for calculating state taxable income. Completing the federal return first ensures that figures are accurate and transferable. Taxpayers must also transfer deductions, credits such as the earned income tax credit, and other details directly from the federal return to Vermont’s Form IN-111 and related schedules. This connection makes the federal income tax return an essential part of the Vermont filing process, helping filers avoid errors and delays.

What Forms and Schedules You’ll Need

Vermont’s 2017 filing process requires several forms, beginning with Form IN-111, the primary Vermont Income Tax Return. This form calculates the state tax owed or refund due, using details from your federal income tax return. Taxpayers must also review Vermont’s official instructions to ensure all required schedules and forms are completed correctly before submission.

Primary Form and Supporting Schedules

  • Form IN-111:The primary state income tax return for individuals and small business owners.

  • Schedule IN-112: Used to claim Vermont tax adjustments and credits, including the earned income tax credit.

  • Schedule IN-113: For part-year residents and nonresidents to calculate the percentage of income subject to Vermont tax.

  • Schedule IN-117: Claims a credit for income tax paid to other states.

Forms for Special Situations

  • Form IN-151: Request a six-month extension to file, though payment is still due by the April filing deadline.

  • Form PR-141: Renter Rebate Claim for qualifying residents with household income under specific limits.

  • Form HS-122: Homestead Declaration and Property Tax Adjustment for Vermont homeowners.

Federal Forms and Tax Statements

Before completing Vermont forms, gather your federal documents. These include Form W-2 from each employer, any 1099 forms for other income, and records of estimated tax payments. Federal adjusted gross and taxable income figures from your federal return are transferred directly to Vermont’s Form IN-111. Matching state and federal data helps taxpayers avoid processing delays, notices, or payment errors.

All official Vermont forms and instructions are available on the Vermont Department of Taxes website. Federal forms can be accessed through the IRS forms and publications page. Reviewing these sources ensures filers have the correct documents and schedules for their filing situation.

Step-by-Step Guide: How to File Your Vermont Tax Return for 2017

Step 1: Prepare Your Federal Income Tax Return

Vermont’s tax calculation begins with the federal income tax return, so completing this is essential. The adjusted gross and taxable income figures transfer directly to Form IN-111. This step also ensures that deductions, credits, such as the earned income tax credit, and other essential details are accurately reflected. Taxpayers should review their federal return for accuracy before moving forward, as errors here will carry over to the state filing process.

Step 2: Gather All Records Quickly

To guarantee accuracy, collect all required documentation before beginning the Vermont return. Add tax statements for dividends, interest, or retirement distributions, W-2 forms from each employer, and 1099 forms for other forms of income. Document any estimated taxes paid during the year. Gather supporting documentation for medical costs, charitable contributions, and mortgage interest deductions. Keeping these documents organized makes creating precise timetables easier, preventing delays, and filing by the April deadline without any last-minute problems.

Step 3: Complete Vermont Form IN-111 and Schedules

Using your federal return as a guide, enter the required information on Form IN-111. Include personal details, the school district code, and your Vermont residency status for the tax year. If applicable, complete schedules such as IN-112 for adjustments and credits, IN-113 for part-year residency calculations, and IN-117 for tax credits paid to other states. Follow the Vermont Department of Taxes instructions carefully, as specific line items may require data from both federal and state records. Taxpayers who owe money should submit payment with the return or arrange payment options through the department’s online service. Those expecting a refund can choose direct deposit for faster processing.

Filing accurately and on time allows individuals to avoid penalties, quickly receive refunds, and reduce the likelihood of receiving a notice from the department. The Vermont Department of Taxes provides official instructions and fillable 2017 tax forms for convenient preparation. Filers can also review the IRS website for federal guidance that supports accurate state reporting.

Filing Methods: Electronic, Paper, and Hand Delivery

Electronic Filing (E-file)

Electronic filing is the fastest and most secure way to submit your 2017 Vermont income tax return. It allows taxpayers to simultaneously send their Vermont and federal income tax returns through approved software providers or authorized tax preparers. E-file submissions are processed more quickly than paper returns, helping filers receive refunds sooner. Many e-file systems provide automatic error checks, which can help individuals avoid common mistakes. Taxpayers who qualify may also use Vermont’s Free File program to prepare and submit their returns without cost.

Paper Filing

Some taxpayers prefer or are required to file a paper return. In this case, completed forms must be mailed to the correct address based on whether you expect a refund or owe money. Paper returns should be printed using blue or black ink and include all required schedules and supporting documents. Mailing deadlines align with the April filing deadline, and Vermont considers a return timely if it is postmarked by the due date. If the due date falls on a weekend or holiday, returns are considered on time if received by the next business day, such as the following Monday or Friday in certain years.

Hand Delivery

For those who prefer in-person service, returns may be delivered directly to the Vermont Department of Taxes office. This method ensures that your return is received on time and can provide peace of mind for taxpayers submitting close to the deadline. Returns must be dropped off within business hours on or before the due date to be considered timely. Hand delivery is helpful for individuals requesting payment arrangements or having specific filing questions before submission.

Payment Options and Extensions

Accurately filing your 2017 Vermont income tax return is just one step. To help you pay your debt by the April filing deadline, the Vermont Department of Taxation offers several payment options. Paying on time helps taxpayers avoid additional interest charges and penalties while ensuring compliance with state requirements.

The state's secure payment portal allows taxpayers to make online payments using an electronic check, also known as an ACH debit. This method allows for quick and cost-effective payment processing. Although a service charge based on the amount owed is applied, credit card payments are also accepted. Those who would rather use more conventional means can mail a check or money order made payable to the Vermont Department of Taxation. Include the appropriate paperwork and schedules with your payment when you send it in with your return to avoid processing delays.

You should still file your return on time and make as many payments as possible to avoid penalties, even if you cannot pay the entire amount by the deadline. Through its customer service channels, taxpayers can directly arrange a payment plan upon request. In addition, taxpayers can request an extension of time to file their return by submitting Form IN-151; however, this does not extend the time to pay. Even though the return will be filed later, payments must be made by the initial April deadline to avoid interest charges.

You will be monitored following payment or return submission. This ensures that all information has been processed correctly and allows you to address any issues quickly if they arise.

Tracking Your Refund or Balance Due

Online Refund Tracking
The Vermont Department of Taxation offers an online refund tracking service for taxpayers who want to receive a refund from their 2017 income tax return. Filers can use this tool to check their progress rapidly by entering their Social Security number, filing status, and return refund amount. People can find out if their refund is being processed, authorized, or scheduled for payment by using online tracking.

Account Tracking,
In addition to refund tracking, taxpayers can access their account information to review past payments, view updated balances, and confirm receipt of any recent submissions. This feature is helpful for those who owe money, as it provides real-time updates and ensures that payments are applied correctly. Account monitoring also helps taxpayers identify any notices issued by the department so they can address them promptly.

Common Delay Reasons
Several issues can slow the processing of a return or refund. Missing or incorrect Social Security numbers, math errors in calculations, or incomplete schedules can require manual review. Refunds may also be delayed if withholding amounts on W-2 or 1099 forms do not match the amounts reported on the return. Sometimes, the department may request additional documentation to verify identity or income, which should be provided quickly to avoid further delays.

Final Filing Checklist

Forms and Schedules
Before sending your 2017 Vermont income tax return, carefully review each page to confirm that all required information has been provided. Ensure that Form IN-111 is fully completed, signed, and dated. Double-check that every entry matches the figures from your federal income tax return, where applicable. Attach all necessary schedules, such as IN-112 for tax adjustments and credits, IN-113 for income allocation by part-year residents or nonresidents, and IN-117 for credits on taxes paid to other states. Include supporting documents like W-2 forms, 1099 forms, and other tax statements verifying income or deductions. Missing schedules or attachments can cause delays in processing and may result in a notice from the department.

Payment Information
If you owe money, confirm that your payment matches the balance shown on your return. Checks or money orders should be made payable to the Vermont Department of Taxes, and your Social Security number should be included to ensure the correct application is made. For electronic payments, confirm that your bank account information is accurate and that the transaction date is set on or before the April filing deadline. Late payments can incur interest and penalty charges, even by a single day. Taxpayers using payment vouchers should ensure the correct form is included when sending payment separately from the return.

Record Keeping
After filing, store a complete copy of your return, including all schedules, forms, and supporting documents, in a safe and accessible location for at least three years. Keep proof of payment, whether a bank statement, canceled check, or electronic payment confirmation. Organized records make it easier to respond quickly to department questions and prepare future returns accurately. Good record keeping also helps taxpayers learn from previous filings, avoid repeated errors, and promptly provide information if an audit or verification is required.

Frequently Asked Questions

What if I missed the April filing deadline?

If you miss the April filing deadline for your 2017 Vermont income tax return, you may still file within the state’s 60-day grace period to avoid a late filing penalty. However, interest will apply to any amount owed after the initial due date. Prompt filing lowers interest costs, expedites processing, and guarantees that any refund you are entitled to is given without needless hold-ups or administrative hassles.

Can I e-file my Vermont and federal income tax returns together?

Yes, most approved e-file providers allow you to file Vermont and federal returns simultaneously. This combined process reduces the risk of errors, shortens the refund processing time, and fulfills both filing requirements in a single step. E-filing also provides immediate confirmation that your returns have been received, giving you peace of mind while ensuring accurate and timely processing for faster refund issuance, if applicable.

How do I claim the earned income tax credit on my Vermont return?

Vermont’s earned income tax credit is calculated as a percentage of your federal credit. First, determine your federal earned income tax credit amount, then report it on Schedule IN-112 following Vermont’s official instructions. Transfer the calculated state credit to Form IN-111. This credit reduces your Vermont tax liability and may increase your refund, so it is essential to claim it if you meet the eligibility requirements to maximize your tax benefits.

What should I do if I owe money but cannot pay it in full?

You should still file your return on time, even if you cannot pay the full amount owed. Pay as much as possible by the April deadline to reduce penalties and interest. Then, contact the Vermont Department of Taxes to arrange a payment plan. These agreements allow you to pay the remaining balance over time while maintaining good standing and avoiding further enforcement or collection actions from the department.

How do I request an extension to file?

You can request a filing extension by submitting Form IN-151 to the Vermont Department of Taxes by the April due date. This extension gives you until October to file your return. However, it does not extend the deadline for paying any taxes owed. You must make full payment by April to avoid late payment penalties and interest charges, even if the return is submitted later under the extension.

What deductions and credits are most commonly missed?

Commonly overlooked tax benefits include Vermont’s capital gains exclusion, deductions for contributions to traditional IRAs, and credits for income taxes paid to other states. Many taxpayers also fail to claim charitable contribution deductions or property tax adjustments. Reviewing each applicable schedule before submitting your return helps ensure you claim every deduction and credit you are eligible for, which can reduce your overall tax liability or increase your refund.

How long does it take to receive my refund?

Refunds from e-filed Vermont returns are typically issued within a few weeks, while paper returns may take longer to process. Delays can occur due to errors, missing forms, or discrepancies between reported income and official tax documents. If the Vermont Department of Taxes requests additional information to verify your identity or income, respond promptly to avoid extended delays and ensure your refund is issued as soon as possible.